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Premier Wen offers helping hand to Europe

Updated: 2011-06-28 20:19

(Agencies)

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Premier Wen offers helping hand to Europe

German Chancellor Angela Merkel shakes hands with Premier Wen Jiabao as she welcomes him to the Chancellery in Berlin, June 28, 2011. [Photo/Agencies] 

BERLIN - Premier Wen Jiabao said on Tuesday China would extend a helping hand to Europe and had faith in the region's economy and in the single currency.

The euro zone's debt problems showed the global economy was still in a state of uncertainty, and inflation was now a worldwide problem rather than one restricted to single countries, he told a joint press conference with Chancellor Angela Merkel during an official visit to Germany.

China would buy appropriate levels of debt issued by euro zone countries if needed, he said.

It would also continue to press for reforms to the global financial system.

China has a "massive" interest in a stable euro, Merkel earlier told the same conference.

Merkel said she reassured her Chinese guest during talks in the German capital that her government was working to ensure the "solidarity and solidity" of the euro.

Premier Wen Jiabao and Merkel aim to boost trade between the world's two biggest export nations to at least 200 billion euros ($283.8 billion) in the next five years, they said at a meeting in Berlin on Tuesday.

Wen also took the opportunity to express his confidence in the euro zone, saying the debt crisis of some member countries such as Greece was only of a "temporary nature".

"It's true that right now some European Union countries are encountering economic problems. These are, however, of a temporary nature," Wen told the first ever full ministerial consultations between China and Germany.

The Chinese premier said the EU was "fully in a position to overcome the present challenges".

About a quarter of China's record foreign currency reserves of more than $3 trillion are estimated to be held in euros and China has reiterated its confidence in the euro since the debt crisis began, as well as pledging to buy euro zone debt.

 TRADE FOCUS

Wen made it clear that the main point of the meeting between Chinese and German ministers and economic officials in Berlin was to "boost the growth potential of bilateral trade ... and to once again double our bilateral trade volume in five years".

Merkel said she expected bilateral trade to reach about 200 billion euros over that period, from 130 billion euros in 2010 when trade has already surged 34 percent on the previous year.

Germany hopes for a rebalancing of investments between the two countries, with Germany's direct investments in China now standing at 20 billion euros compared to Chinese investments in Germany of only about 600 million, German officials said.

China's German investments have to date focused on small and medium-sized firms, though media have speculated on a possible tie-up between Opel and China's Beijing Automotive Industry Holding Co (BAIC). The German carmaker already works closely with another Chinese firm, SAIC Motor Corp , via parent General Motors Corp .

($1 = 0.705 Euros)

 

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