In the second half of the 20th century, the world economy entered an unprecedented period of rapid growth together with rapid advances in science and technology. Countries and regions have formed ever- closer trade and economic relations, and their economic interests are more and more intertwined. Big nations are engaged in competition in comprehensive national strength, with the economy as the basis and science and technology as the lead, and they all give priority to invigorating the economy and striving for a most advantageous position in the world economy.

By the end of the 1970s, China began to pursue a policy of reform and opening to the rest of the world. Since then the Chinese economy has been growing rapidly, scoring great achievements. In 2004 China’s gross domestic product amounted to 136,515 billion yuan, or about 1.7 trillion US dollars.

China has embarked on a path of peaceful development. A most simple and clear explanation of this path is: in the present era with peace and development as the main themes, China as a socialist country has decided to follow the path of seeking development while safeguarding world peace and contributing to world peace through its own development.

This path of peaceful development features coordinated domestic development and opening up. China is a developing country with a population of nearly 1.3 billion and is faced with numerous difficulties. Its per capita GDP ranks only 111th in the world. It requires the unremitting efforts of generations to come in order to achieve development, rejuvenation, modernization and the common prosperity of all the Chinese people. In this historical process, China needs both internal stability and a peaceful international environment. The Chinese people will unswervingly adhere to the central task of economic development, which is top priority, and resolve all problems through development. At the same time, the Chinese people will also unswervingly uphold peace and cooperation in their foreign policy, and work with all peoples to promote the lofty cause of peace and development.

This path of peaceful development emphasizes bold participation in economic globalization together with active efforts to develop extensive and mutually beneficial cooperation. China’s domestic reform is, from the very beginning, linked with opening to the rest of the world. Economic globalization interweaves the interests of all countries, facilitates the global circulation of productive factors and makes nations interdependent in their development process. Bold participation in international economic and technical cooperation gives China access to capital, advanced technologies, managerial expertise and various professional people, which were unimaginable during its period of self-seclusion. Participation in economic globalization according to the principles of independence and seeking advantages while avoiding disadvantages helps to integrate China’s development with regional economic invigoration, with the interests of people of all countries and with the cause of peace and development of humanity.

With rapid economic growth, China’s market has kept expanding, and its contribution to the world’s economic growth is on the rise. In 2003 China accounted for over one third of the increase in the world’s total imports, contributing more to the growth of world trade. As an authoritative personage put it, China’s rapid economic growth has provided five opportunities for the world:

First, the growth of China market creates new room for the growth of the world economy. With its efforts for market-oriented reform, China is turning itself into a large emerging market in the world by integrating domestic and foreign trade and forming a unified national market that has become more orderly. China has built the largest telephone systems in the world, which added 110 million new subscribers in 2003. The same year China sold 4.4 million motor vehicles, a year-on-year increase of 34 percent. That was an increase of over 1 million units in both the output and sales of motor vehicles, something rarely seen in the history of the world’s automotive industry. Such a vigorous market demand not only supported the rapid development of China’s economy but also acted as an important driving force for economic growth of the world.

Second, China’s soaring import trade provides huge opportunities for businesses in other countries. For more than 20 years, China’s imports have been growing at an annual rate of over 15 percent. Its imports amounted to 412.8 billion US dollars in 2003, an increase of 117.6 billion dollars or over one third of the increase in the total imports of the world. From 2001 to 2003 China purchased nearly 1 trillion dollars worth of foreign goods. The Chinese Ministry of Commerce estimated in 2003 that after 2020 China’s annual imports would surpass 1 trillion dollars. Many foreign businesses have made substantive benefits from China’s increasing demand for imports.

Third, China’s rapid economic growth promoted the recovery of the world economy. Although China’s national income is not large enough to have a big impact on the world economy, its sustained rapid economic growth sent a message to and enhanced the confidence in the world economic recovery. In recent years the rapidly growing Chinese economy has been a bright spot in the world economy. According to a report released by the UN Conference on Trade and Development on May 4, 2004, the United States, Germany, Britain, France and China were estimated to be the largest sources of foreign investment in 2004-2005. This is the first time that a developing country was included among the top five sources of foreign investment. Many developing countries also listed China as the second largest source of foreign investment next to the United States.

Fourth, the further development of China’s economy provides innovative opportunities for the economic development of neighboring countries and regions. Statistics show that in 2003 China’s imports from Japan, the Republic of Korea (ROK) and the Association of Southeast Asian Nations all exceeded 30 percent, to be an important factor for the growth in exports of these countries. China has become the second largest market for Japan’s exports and the largest importer of goods from the ROK.

Fifth, China’s accession to the World Trade Organization (WTO) provides good development environment for transnational companies. Improvement in the investment climate has resulted in increase in investment in China by foreign businesses. Of the world’s Top 500 corporations, more than 400 have invested in China. From 1978 to March 2004, foreign direct investment in China amounted to 513.8 billion US dollars. Industries most favored by foreign investors include information and communication, services, and motor vehicles. All the leading automakers in the world have made investments in China, and so have over 90 of the world’s top 100 information technology companies. Most of the foreign-funded firms in China are making good profits. For them, presence in China means both market shares and competitiveness in the world market.

As a leading official at the Chinese Ministry of Commerce noted in late April 2004, while pursuing a new scientific approach to development, China will attach more importance to coordination of both domestic and world markets, and participate in international competition and cooperation in the economic and technological fields in wider areas and at higher levels. In the meantime, China will always follow the long-term strategy of expanding domestic demand to sustain economic growth, and its domestic market is enormous. The state will also perfect its consumption policy, improve the consumption environment, and cultivate new growth areas for consumption. China is expanding its cooperation with other countries in science and technology, culture and education, and its tourism industry is one of the fastest growing in the world. All this will make great contributions to the growth of world trade in the services sector.

Facts have proved and will continue to prove that China’s peaceful development poses no threat to any country but provides wonderful opportunities for all. The theory of “China threat” harped by some people wearing colored spectacles is giving way to a theory of “China opportunity.”

Looking ahead, we have full confidence in the future of China and the world. China will always be a force for world peace; it will never seek hegemony, never seek any sphere of influence, and never be a superpower. The Chinese people will work together with people of the world for maintaining world peace and promoting common development.