China-Asean relations, April 2006 to September 2006: Chronology of Events.

As a research institute based in Singapore, the EAI monitors developments in relations and interactions between China and the individual countries of Southeast Asia as well as the ASEAN grouping as a whole. This material is presented in the form of: (1) a chronology of events, and (2) important documents.

--the Editors

APRIL 

2nd Jia Qinglin, Chairman of the National Committee of the Chinese People's Political Consultative Conference (CPPCC) concludes official visits to Vietnam, Indonesia and Malaysia. Jia met with leading government officials in all three countries. He also met with local government officials and representatives from the industrial, commercial, cultural and academic circles of the three countries.

8th According to a joint communique issued at the end of Premier Wen Jiabao's visit to Phnom Penh, the Chinese and Cambodian governments will establish a Comprehensive Partnership of Cooperation.

The two sides will maintain high-level exchange visits and cooperation between government departments, parliaments, political parties, armed forces, local governments and non-governmental organisations. A series of activities to mark the 50th anniversary of diplomatic relations will be held in 2008. The two sides will enhance the role of the China-Cambodia Economic and Trade Cooperation Joint Committee in planning, coordinating and promoting bilateral economic cooperation and trade.

The two countries pledge to strive towards the goal of USD one billion worth of annual bilateral trade by 2010. The Cambodian side expresses thanks for the preferential tariff treatment provided by the Chinese side for 418 Cambodian products.

The Chinese side supports the efforts of capable Chinese enterprises to strengthen cooperation with Cambodian enterprises in infrastructure, mineral, gas and oil exploration, manufacturing, processing of textiles and other fields. The Cambodian side will facilitate trade, investment and other business activities carried out by Chinese enterprises in Cambodia.

The two countries agree to boost cooperation in agriculture, transportation, culture, education, health, the information industry, sports and tourism. They welcome the forming of a Sister City Relationship between Shanghai and Phnom Penh, and the forming of Sister Province Relationships between Hainan Province and Kampong Cham Province, and between Yunnan Province and Siem Reap Province.

The two sides agree to strengthen bilateral diplomatic consultation, exchange views on major international and regional issues, maintain close coordination to safeguard their shared interests and contribute to peace, stability and development in the region and the rest of the world. The two countries will strengthen coordination and collaboration in the United Nations and other international organisations. They agree to work together to promote the ASEAN-China strategic partnership for peace and prosperity, implement the Programme of Action for ASEAN-China Strategic Partnership and speed up the establishment of the ASEAN-China Free Trade Area. The two countries agree to strengthen coordination and cooperation in ASEAN+3, the East Asia Summit, the Asia Cooperation Dialogue, the ASEAN Regional Forum, the Asia-Europe Meeting and the World Trade Organisation. The Chinese side expresses the hope to see Cambodia become an APEC member at an early date.

13-20th Singapore Senior Minister Goh Chok Tong visits China. He and Chinese Premier Wen agree that Singapore and China can work together to explore joint cooperation with third countries, such as India and those in the Middle East. They agree that Singapore and China should encourage more Chinese companies to list on the Singapore Exchange as part of efforts to help Chinese firms go global.

Both leaders express satisfaction with the Suzhou Industrial Park, which Mr Goh is scheduled to visit later this week, and agreed to encourage its growth.

Mr Goh also said there would be several high-level visits from Singapore to China this year to boost ties. One area in which the two sides could cooperate was maritime security, as both China and Singapore were 'heavily dependent' on international trade.

"It is in our common interest to ensure that the major sea lanes of communication through our region remain free and secure from threats," Mr Goh said. "China, as a major user-state of the Strait of Malacca, can contribute more to the efforts to tackle the various security threats that are of concern to the international shipping community."

14th Singapore Senior Minister Goh Chok meets Jia Qinglin, the Chairman of the CPPCC.

Mr Jia briefs Mr Goh on the ongoing Kuomintang-Chinese Communist Party Economic Forum and China's current policy on the Taiwan issue, while Mr Goh reiterates Singapore's long-standing one-China policy and the country's opposition to Taiwanese independence. The two leaders also discuss recent developments in Southeast Asia and ASEAN. In particular, they agree that India and China have important roles to play in fostering the development and stability of the region. They also discuss Sino-Japan relations extensively.

15th Vietnamese President Tran Duc Luong receives Cao Bochun, Secretary of the CCP Committee of China's Guangxi Zhuang Autonomous Region in Hanoi. The Vietnamese leaders propose that Guangxi help Vietnam develop infrastructure, and plan and mobilise sources to boost Vietnam-China economic and commercial ties. The two sides agree on the need to establish a task force to jointly develop transport, thus promoting economic development in the Tonkin Gulf region.

16-18th Vietnamese Deputy Governor Nguyen Huu Tin meets visiting Nanning's Secretary Ma Xiao who led a Chinese delegation to seek business opportunities in Ho Chi Minh City. It is agreed that the two cities will welcome each others' enterprises, offer them favourable conditions and encourage them to mutually invest and do business.

The Ho Chi Minh City Friendship Association holds a meeting with a delegation from Guilin led by its Secretary Mo Yongqing.

In 2003, Guilin was offered a Friendship Medal by the Vietnamese Government for its contributions in education and training. Currently, there are more than 400 Vietnamese students studying in the city, equal to one tenth of the total number Vietnamese students in China.

18-20th The ASEAN-China Information and Communications Technology (ICT) Week is held in Penang, Malaysia. ASEAN countries and China agree to expedite the implementation of the Greater Mekong Sub-region (GMS) information superhighway project to further strengthen ICT infrastructure in the region.

They plan to explore the possibility of expanding the GMS project to cover all ASEAN countries and establish an ASEAN-China information superhighway.

The ministers also agree to organise study visits, training programmes, an ASEAN-China ICT seminar and a joint symposium on radio frequency identification application this year. In addition, ASEAN and China agree to enhance rural communication and to consider the implementation of pilot projects involving actual application of suitable technology in selected rural areas in the region.

To facilitate intra-regional trade, investment and logistics, particularly in light of the proposed ASEAN-China Free Trade Agreement, studies may be conducted on e-commerce and e-government, regional standards and mutual recognition agreements for telecommunication equipment certification and ICT expertise certification.

22nd At the Boao (Hainan) Annual Forum for Asia meeting, Chinese Vice President Zeng Qinghong, when speaking with his Indonesian counterpart Yusuf Kalla, vows to enhance cooperation with Indonesia in such fields as energy. Some 850 Chinese and overseas officials, business people and scholars attend the activities of the forum.

Cao Bochun, secretary of CCP's Committee of Guangxi Zhuang Autonomous Region and his delegation arrive in Phnom Penh to pay a two-day visit. The delegation donates seven vehicles, 100 walking tractors and 200 water pumps to Cambodia.

Cambodian Prime Minister Hun Sen and Cao agree to further strengthen their cooperation on trade and economy, as well as other fields. Hun Sen also expresses hope that Guangxi Zhuang Autonomous Region will form a Sister Province Relationship with a Cambodian province.

MAY

4th Finance ministers from ASEAN+3 hold a meeting in Hyderabad to discuss the region's financial cooperation. Discussions focus on financial sector cooperation, a surveillance and policy dialogue process through which countries discuss economic and financial sector trends and indicators, and the Chiang Mai Initiate (CMI) which is a network of bilateral currency swap arrangements (BSAs) among the ASEAN countries, China, Japan and South Korea. As of 2004, financial cooperation discussions have also included the Asian Bond Market Initiative (ABMI).

The CMI has two components: an expanded ASEAN Swap Arrangement and a network of bilateral swap arrangements among ASEAN + 3.

The ASEAN Swap Arrangement (ASA) preceded the regional financial crisis. It was originally established by the ASEAN central bank and monetary authorities of the five founding members of ASEAN with a view to help countries meet temporary liquidity problems. An expanded ASA now includes all the ASEAN countries with an expanded facility of USD2 billion.

The ABMI aims to develop efficient and liquid bond markets in Asia, enabling better utilisation of Asian savings for Asian investments. It is also designed to contribute to the mitigation of currency and maturity mismatches in financing.

6th ASEAN + 3 Labour Ministers meet in Singapore following the ASEAN Labour Ministers meeting. This meeting is now held on a biannual basis to promote and study labour related issues.

9th Malaysian Foreign Minister Syed Hamid Albar in Kuala Lumpur, who failed to meet Suu Kyi during a recent trip to Rangoon, warns the junta that the credibility of its "roadmap to democracy" would be at risk if it banned the National League for Democracy (NLD).

"Any action they take, like closing down the NLD, or not releasing Aung San Suu Kyi--these are all impediments and obstacles to creating visible signs of credibility in terms of the movement towards democracy," Syed told reporters.

In addition to ASEAN member-nations, Chinese leaders are also concerned about recent political developments in the military-ruled country. "China wants to see a new setup in Burma," said a western diplomat with close ties to Rangoon's diplomatic corps. After the removal of Khin Nyunt, Chinese leaders were said to be disappointed by Snr-Gen Than Shwe's increasingly hard-line approach and his efforts to consolidate power.

Khin Nyunt was known to be close to Beijing, as Chinese leaders viewed him as "pragmatic". He was also seen by some within Burma's military government as Beijing's man in Rangoon. When Khin Nyunt was ultimately ousted in late 2004, China lost a high-ranking contact within the regime, which it has since been anxious to restore. It seems China has found its man in Gen Soe Win.

13th Chinese Premier Wen tells visiting Singapore Minister Mentor Lee Kuan Yew that Singapore-China relations are entering a "new stage" and outlines areas where he believed cooperation could be developed further, namely, energy.

Premier Wen also sees Singapore having a role in China's developing ties with ASEAN. China's trade with ASEAN is expected to reach USD200 billion by 2010, and Beijing and the 10-nation grouping are working towards a free trade agreement. Mr Wen reiterates that China respects ASEAN's position in the driver's seat of regional cooperation efforts.

18th A meeting is held in Beijing between the Chinese People's Association for Friendship and Foreign Countries and ten non-government ASEAN organisations. A "People-to-people Declaration" is signed vowing to step up people-to-people cooperation by non-government organisations of China and ASEAN.

JUNE

6th Chinese State Councillor Tang Jiaxuan says China will enhance friendly exchanges and cooperation with Brunei Darussalam in political, economic and cultural fields. Tang made the remarks in a meeting with Lim Jock Seng, Brunei' Second Minister of Foreign Affairs and Trade.

11th On the occasion of a Pan Pearl River Delta Transportation discussion, Weng Mengyong, Deputy Minister of the Chinese Ministry of Communications, opines that expediting expansion of land links to ASEAN by 2020 will help bring China closer to the international market.

China, Laos and Thailand have agreed to build a 1,818-km international highway which will start from Kunming, capital of Yunnan, and end in Bangkok. China is also stepping up construction of a railway that will link China and ASEAN via Yunnan. A feasibility study has been completed for construction of the Chinese section of the proposed Pan-Asian Railway that will run from Singapore, through Malaysia, Thailand and Myanmar before reaching Yunnan Province.

22nd-23rd The 2nd ASEAN+3 Health Ministers' Meeting followed by the 1st ASEAN-China Health Ministers Meeting is held in Yangon. The Health Ministers lay down the second phase strategic framework for their Emerging Infectious Diseases (EID) Programme. According to a joint statement, the EID Programme's second phase activities will provide ASEAN+3 countries with greater opportunities to share and exchange information, experience and expertise in combating threats to the health and security of their people.

These activities will also bring the ASEAN+3 countries closer together in preparing for future threats of disease outbreak including those related to natural disasters, bio-terrorism and pandemic influenza, and also facilitate partnerships among existing networks and experts on public and animal health.

The ASEAN+3 ministers devise plans to mount a regional initiative to bring together health, trade and other relevant policy-makers and stakeholders to discuss and develop multi-sector healthcare into development agendas. They also discuss HIV/AIDS prevention and control, avian influenza and EIDs, traditional medicines and the operation of the ASEAN-China Public Health Fund.

The representatives from China make a number of suggestions on establishing ASEAN-China epidemic prevention and control mechanisms and improving information exchange. They also propose use of the ASEAN-China Public Health Fund to strengthen cooperation with ASEAN countries on public health and financial programmes while welcoming proposals from ASEAN and giving positive consideration to funding them.

23rd In a seminar entitled "Chinese Language, Problems in Mastering It and Its Role in International Business", held at the University of Indonesia in Jakarta, Trade Minister Mari Elka Pangestu says that the Indonesian and Chinese Governments through their Joint Commission agree to increase the value of their bilateral trade to USD30 billion by 2010.

Mari emphasises the importance of mastering the Chinese language in order to obtain reliable information. She said anticipation and penetration steps in a business policy depended on the accuracy of information.

27th A Vietnamese minister announces that Vietnam, which has among the world's highest car prices due to hefty taxes, is cutting tariffs on vehicles imported from Southeast Asia and China to 50 per cent from 90 per cent as part of a regional trade pact. A Finance Ministry document indicates that the new tariffs apply retroactively from January 2006 for automobile imports from China, Thailand, Singapore, the Philippines, Myanmar, Malaysia, Indonesia, Laos, Cambodia and Brunei.

Tariffs on cars imported from other countries remain at 90 per cent, according to the new rules, which were approved by Deputy Finance Minister Truong Chi Trung on 12 June. Tariffs and taxes on imported automobiles have been gradually decreased as the country moves to reduce protection for domestic car assemblers including majors such as Ford and Toyota.

From January 2006 consumption taxes on imported vehicles were also reduced to 50 per cent from 80 per cent, similar to the rate applied to domestically-assembled vehicles. Vietnam's annual per capita income remains one of the world's lowest at around USD640 but its car prices are among the highest due to high tariffs and taxes. A Toyota Camry sedan sells for USD65,000 compared to around USD 20,000 in Japan.

Dealers said the lower tariffs would benefit Chinese car makers as they prepare to introduce low-cost Chinese vehicles to Vietnamese consumers. This month Chinese auto group Lifan said it would establish a USD30 million joint venture with Vietnamese firms to produce its sedan model Lifan 520 which retails for USD16,000.

Vehicle sales by 11 foreign-backed auto makers in Vietnam fell nearly 27 per cent to 9,418 units during the first five months of this year from a year earlier as consumers held off on purchases to wait for further tax reductions

JULY

2nd-7th Former Vice Premier of the Chinese State Council, Li Lanqing, visits the National University of Singapore where he is conferred an honorary Doctor of Letters degree for his efforts in developing the Singapore Suzhou Industrial Park in China. He later launches his books, one on Chinese education reforms and one on music.

26th At the 7th ASEAN+3 Foreign Ministers' Meeting held in Kuala Lumpur, the ministers welcome the establishment of cooperation in four new sectors under the ASEAN+3 framework: cooperation in rural development and poverty eradication, women issues, disaster risk management and emergency response and minerals.

The ministers reaffirm the urgent need to address energy security issues as the increase in oil prices has highlighted the need to search for alternative sources of energy.

The ministers reiterate their consistent position that the next United Nations Secretary-General shall be selected from an Asian member state of the UN. They also discuss the preparations for the 10th ASEAN+3 Summit and the 2nd East Asia Summit, to be held 11-13 December 2006 in Cebu, the Philippines.

The ministers also discuss the North Korean nuclear issue and escalating violence in the Middle East. On the former, the ministers express the desire for a denuclearised Korean Peninsula and the resumption of six-Party talks. They believe that the ASEAN Regional Forum could play an active role in this process.

They also express pleasure at the success of the 1st East Asian Summit held in Kuala Lumpur last December. They affirm that the summit, as an open and outward-looking forum, can serve as a platform for dialogue on broad strategic, political and economic issues of common interest to promote peace and economic prosperity in East Asia.

The East Asia process will be developed incrementally and deinstitutionalised. In the short-term, it will concentrate on co-operation through existing ASEAN mechanisms in five priority areas including energy, finance, education, prevention and control of bird flu and disaster relief.

In the spirit of the Kuala Lumpur Joint Declaration on ASEAN+3 last year, the ministers agree to expand co-operation to several new fields including energy security, rural development, hunger eradication and poverty alleviation, and natural disaster management.

26-27th The 5th Senior Officials Meeting on Energy+3 followed by ASEAN+3 Ministers on Energy meeting is held in Vientiane. The Ministers discuss energy security as well as energy sustainability issues.

31st The 3rd China-ASEAN Attorney Generals' Meeting is held in Jakarta to strengthen cooperation in combating transnational crimes such as terrorism, corruption and money laundering as well as human and drug trafficking.

Jia Chunwang, Procurator-General of the Supreme People's Procuratorate of China makes proposals for deepening exchange and cooperation, such as maintaining the exchange of high-level visits, promoting the system of public procurators' exchange of expertise and upgrading the professional quality of procurators.

AUGUST

17th The Senior Economic Officials Meeting (Ministry of Commerce of China and Senior Economic Officials Meeting + 3 Consultations) is held in Kuala Lumpur. In an interview with Bernama, the Deputy Secretary-general of the China-ASEAN Business Council and a leading expert on doing business with Southeast Asia, Xu Ningning, describes the FTA as a marriage of ideal partners and that a trade surplus for ASEAN is favourable. He said the FTA talks had been progressing smoothly and much had been achieved in the relatively short time frame since both sides agreed on the FTA.

The Chinese private sector has been very active in Southeast Asia this year. Officially, Chinese investments in Southeast Asia are worth USD one billion but in reality, the figure is likely higher because there are several investments from private companies that have not been taken into account.

Xu disagrees that China needs to resolve its trade deficit with ASEAN. A trade surplus for ASEAN means it can continue to generate growth and stability in the region and ASEAN will continue to play a leading role. ASEAN has nudged up in position to become China's fourth largest trading partner. In the first half of the year, bilateral trade increased 22 per cent to USD72.7 million with a trade surplus of USD8.75 billion for ASEAN. Last year, overall trade reached a record USD130.3 billion with ASEAN's exports to China outpacing imports by USD19.6 billion.

22nd Vietnamese Communist Party General Secretary Nong Duc Manh visits Beijing. The talks focus on economic cooperation towards realising the target of two-way trade turnover of USD10 billion before 2010.

As well, the two countries pledge to continue to accelerate the process of developing their "two corridors-one belt" economic link. The Vietnamese Party Chief said Vietnam welcomes China's large scale investment projects.

Chinese President Hu Jintao reiterates his country's continuing support for Vietnam's bid to join the World Trade Organisation. The two sides discuss measures towards signing new regulations on border management by 2008.

They also agree to continue implementing agreements on joint patrols and cooperation in other fields in the Tonkin Gulf, to continue negotiations on the demarcation in the Gulf and to promote negotiations on sea-related issues.

The two sides said they would continue cooperation and coordination at multilateral forums such as the United Nations, Asia-Pacific Economic Cooperation and China-ASEAN.

After the talks, Manh and Hu witness the signing of a credit loan granted by the China Export-Import Bank to build Vietnam's 300MW Cam Pha Thermo-electric Power Plant 1.

24th The 9th ASEAN Economic Ministers + 3 Consultations are held in Kuala Lumpur. Malaysia's Trade Minister Rafidah Aziz says Southeast Asia is on track to sign an agreement with China opening up its lucrative services sector by the end of the year.

The deal will help Southeast Asian firms do business in China's services industries including banking, information technology and tourism. China's Vice Minister of Commerce Yi Xiao Zhun vows to accelerate the negotiations and attributes the slow progress to lack of familiarity with the area.

"China is not very experienced in services ... and probably this is why the progress has been slow", he said. Another ASEAN official said that 12 service sectors were under discussion and that they include finance, telecommunications and tourism.

26th Nong Duc Manh, general secretary of the Vietnamese Communist Party Central Committee, visits China's Guangxi Zhuang Autonomous Region.

He appeals to the two sides to further cooperate in railway and road building and promote regional economic cooperation. He speaks highly of Guangxi's social and economic achievements. He asks the two sides to strengthen trade and economic cooperation and to contribute to regional development by actively participating in the ASEAN-China framework.

Manh visits Lenovo's headquarters in Beijing, as well as Dalian Shipbuilding Industry Co., Ltd. and Dalian Machine Tool Group in Liaoning Province. During meetings with officials and business people, Manh invites strong Chinese companies to invest in Vietnam, especially for large key projects. China-Vietnam trade hit USD8.2 billion in 2005 and may reach USD10 billion this year. According to the Chinese Ministry of Commerce, 37 Chinese companies were set up in Vietnam last year, with investment of USD55 million dollars. A total of 146 Chinese companies had invested in Vietnam by the end of 2005 with a total contractual investment of USD170 million.

SEPTEMBER

1st Wang Cheng, president of the China-Shenzhen International Cooperation Company announces that the company plans to invest about USD200 million to develop an industrial park (IP) in the Vietnamese city of Danang. The 200-hectare IP will house textile and garment producers from China. It is envisaged that the project will generate about 10,000 jobs, and annual revenue of about five billion yuan (USD628 million). Wang said his company was also eyeing other sectors like high-rise buildings and resorts.

4-5th The 4th Meeting of the ASEAN-China Joint Science and Technology Committee is held in Lijiang, China. It is co-chaired by Mr. Awg Hj Hepnie OKPSD Abang Hj Abu Hanifah, Deputy Permanent Secretary of the Ministry of Development, Brunei Darussalam, who represented Mr. Haji Mohd Said bin POKPS DP Haji Hashim, the ASEAN Committee on Science and Technology Chairman and Mr. Meng Shuguang, Deputy Director-General of China's Department of International Cooperation of the Ministry of Science and Technology. A number of agreements are introduced including the transfer of bio-technology capabilities to Yunnan Province.

6th Bruneian Minister of Foreign Affairs and Trade, Mohamed Bolkiah, makes an official visit to China. Chinese State Councillor Tang Jiaxuan praises Brunei's role in boosting China-ASEAN ties, calling on both countries to make greater efforts to promote China-ASEAN strategic partnership. Mohamed said Brunei highly values its relations with China, and hopes to enhance bilateral cooperation in the fields of energy, telecommunication, tourism and infrastructure.

This chronology of events in ASEAN-China relations was sourced mainly from the ASEAN Secretariat web <http://www.aseansec.org/>; The Straits Times; Bangkok Post; Bernama (Barisan National News Agency); Comparative Connections: An E-Journal on East Asian Bilateral Relations <http://csis.org/pacfor/cc/>; Chinese Ministry of Foreign Affairs <http:www.fmprc.gov.cn>; Far East Economic Review; Peoples' Daily; South China Morning Post; Manila Standard; BBC; The Jakarta Post; Associate Press Newswire and Xinhuanet <http://www.xinhuanet.com>.