CHINA

Over the past year, the situation in the Asia-Pacific region remained by and large relaxed, but destabilizing factors were on the increase. Developments in the region showed that peace and development remain the two major tasks for the mankind in the 21 st century.

Peace, development and cooperation still underline the policy of most countries in the region:

• With Cambodia's accession, a long-cherished dream of ASEAN's founders was fulfilled. This marked a significant step forward for ASEAN in its strength through solidarity.

• The regional economic situation took a turn for the better as East Asian economy began to restore its growth. Progress has been made in varying degrees in the readjustment and reform, and political and social turmoil that triggered by the financial crisis has been somewhat eased.

• To safeguard the principle of equality of sovereignty, non- interference in internal affairs and other universally recognized norms governing international relations and to establish fair and equitable new international political and economic order represent the common aspiration and objective of the international community including countries in the region.

• China's good-neighborly and friendly relations with its surrounding countries in political, economic and other fields continued to develop.

• Against the backdrop of the complex and changing international situation, there have been some readjustments and changes in the relations among major powers. Despite ups and downs, their relations are still characterized by seeking compromise amidst struggle, promoting cooperation while competing with each other , identifying common interests and averting full-scale confrontation.

• Countries remain committed to dialogue and cooperation. The Joint Statement on East Asian Cooperation issued after the 3rd Informal Summit Meeting by ASEAN, China, Japan and ROK identified important consensus on carrying out mutually beneficial cooperation in the economic, scientific, technological and financial fields. A sound momentum is maintained in regional multilateral security dialogue and cooperation, breeding new security concepts and new approaches to security .

On the other hand, destabilizing factors have increased in the Asia Pacific.

• Far from retreating from regional political and security arena, power politics and Cold War mentality which run counter to the trend of the times, remain active. Fallacies of "new interventionism" such as "human rights overriding sovereign rights" and "humanitarian intervention" are threatening to undermine equality of sovereignty, non-interference in internal affairs and other basic norms governing international relations.

• Tendencies of reinforcing military alliance and asserting external intervention are growing. Some countries have decided to go all out in developing and deploying NMD and TMD systems in an effort to improving both the spear and the shield. The act of seeking absolute security in disregard of other countries' security is bound to break international and regional strategic equilibrium and stability.

• With the acceleration of globalization, gaps between the developing and developed countries are expanding further. The developing countries are met with increasingly severe challenges in their economic security and development.

• Ethnic, religious and territorial disputes and conflicts broke out from time to time. Some transnational issues have brought about new challenges to regional security.

It is an urgent task facing countries in the region to find ways for lasting peace and prosperity in Asia-Pacific and the world at large and to identify the principles that should be followed in handling international relations, addressing world affairs and promoting regional stability .

History has told us time and again that to bring about lasting peace and development in a diverse region as the Asia Pacific, it is imperative to develop state- to-state relations on the basis of Five Principles of mutual respect for sovereignty and territorial integrity, mutual non-aggression, non-interference in each other's internal affairs, equality and mutual benefit, and peaceful coexistence; to nurture a new type of security concept with mutual trust and benefit, equality and cooperation at the core so as to enhance mutual understanding and confidence; to resolve disputes between states by peaceful means; to expand mutually beneficial cooperation between states in the economic and other fields for the purpose of common development; and to adhere to the principles and approaches initiated by ARF , namely, participation on equal footing, progressing in a gradual manner, making decision by consensus, and seeking common ground while reserving differences.

The old security concept based on military alliances and achieved through build-up of military strength does not guarantee international security, let alone building lasting peace.

As a permanent member of the UN Security Council and a big country in Asia-Pacific, China attaches great importance to and is committed to regional peace, stability and development.

Stability and prosperity in China itself is the biggest contribution to regional peace and development. Over the past year, reform and opening-up in China continued to deepen and various reforms went on smoothly. Efforts to expand domestic demand have been successful. China enjoys social and political stability, a sustained economic growth and booming development in all fields.

A stable, developed and unified China is a positive factor for peace and development in the Asia-Pacific region. There is only one China in the world, and Taiwan is an inalienable part of Chinese territory. This is a historical fact universally recognized by the international community. To resolve the Taiwan question and achieve complete reunification of China represents the common aspiration and strong will of the Chinese people at home and abroad. The Chinese Government has always stood for the principle of "peaceful reunification and one country , two systems" in resolving the Taiwan question. However, the one China principle is the prerequisite for peaceful reunification. "Taiwan Independence" in whatever form is absolutely impermissible. We are firmly opposed to any splitist activities of supporting or conniving at the Taiwan authorities. Only by adhering to this can it help bring about an early and peaceful settlement of the Taiwan question, and contribute to peace and stability in the Taiwan Strait, as well as in the Asia-Pacific and the world at large.

Over the past year, China has made further efforts and contributions to promoting regional peace and stability:

• China signed with some ASEAN countries the 21^st century- oriented bilateral cooperation documents. A favorable momentum for stable development has maintained on the whole in Sino-Japanese relations. New progress has been achieved in China- DPRK and China-ROK relations.

• Friendly ties between China and Pakistan continued to develop. There have been continued improvement and some development in China-India relations, including the launching of bilateral security dialogue-Friendly ties between China and Central Asian countries have been further consolidated. China, Russia, Kazakhstan, Kirghizastan and Tadzhikistan successively ratified and are actively implementing the Agreement on Confidence Building Measures in the Military Field Along the Border Areas and the Agreement on Mutual Reduction of Military Forces in the Border Areas.

• China and Vietnam have signed the Treaty of Land Border. All the issues relating to the land border have been resolved. This not only conforms to the common aspiration and fundamental interests of the two peoples, but also contributes significantly to regional peace and stability.

• To further mutual understanding and trust, China has launched bilateral security dialogue with countries in the Asia-Pacific one after another, including the ASEAN members.

• China has taken an active part in ARF , 10+ 3 meeting, APEC, ASEM and other multilateral dialogue and cooperation, and sponsored some cooperation projects aiming at building confidence.

• Proceeding from the overall interest of safeguarding regional peace and stability, China has maintained a highly restrained, responsible and constructive attitude on the issue of the South China Sea, adhering to friendly consultations in resolving disputes with the countries concerned.

China will, as always, pursue an independent foreign policy of peace, and carry out friendly cooperation with all countries, its neighboring countries in particular, on the basis of the Five Principles of Peaceful Coexistence with a view to fostering a peaceful and stable regional security environment. China was, is and will be a staunch force for regional and global peace and stability.