Deals and pledges to help Europe battle debt crisis, enhance cooperation

Premier Wen Jiabao checks out an MG6 car during his visit to the MG plant in Birmingham, central England, on June 26. [Phil Noble/Reuters]

Chinese Premier Wen Jiabao wrapped up a five-day official visit to Hungary, Britain and Germany on June 28, reassuring European countries of China's commitment to help battle their debt crisis.

The trip centered on economic issues and trade deals covering various sectors signed between China and the three countries.

From June 24 to 28, Wen met leaders of the three countries to discuss bilateral relations, China-EU relations, and international and regional issues of common concern.

Europe is grappling with an escalating sovereign debt crisis, nine months after Wen's trip to Greece, Belgium, Italy and Turkey last year.

Chinese Vice-Foreign Minister Fu Ying says Wen's latest visit is a key diplomatic mission in 2011. It aims to push forward China-EU relations, deepen substantive bilateral cooperation and enhance mutual understanding.

Wen pledges to help Hungary with national debt

Premier Wen met his Hungarian counterpart Orban Viktor in Budapest on June 25. Enhancing economic ties was high on the agenda during the meeting, with China promising to buy some Hungarian bonds to help European countries work out the euro-driven debt crisis.

Hungary was the first leg of Wen's three-nation Europe tour. Wen's Hungary visit was the first one to the country by a Chinese premier in 24 years.

"I have confidence in European economic development," Wen said.

"China is a long-term investor in Europe's sovereign debt market. In recent years we have increased, by a quite big margin, our holdings of euro bonds," he said.

"In the future, as we have done in the past, we will continue to support Europe and the euro."

Beijing earlier extended a helping hand to several European countries by purchasing bonds, including those of Greece, Spain and Portugal.

Wen also pledged to double bilateral trade volume to an annual total

of $20 billion (14 billion euros) by 2015, partly by boosting China's imports of Hungary's competitive products.

He said China will provide a special loan of 1 billion euros to support joint projects between enterprises from the two countries, and the Chinese government will support companies participating in the construction of Hungary's infrastructure, industrial parks and logistics centers.

Viktor said his talks with Wen have laid a solid foundation for further cooperation between China and Hungary.

"China's decision to buy our bonds has provided us with a huge sense of security," Viktor said. "Then we can continue our economic reform."

He added that China's great economic and social achievements help the world, and give confidence to Hungary.

Wen also held talks with Hungarian President Pal Schmitt and Parliament Speaker Laszlo Kover to convey China's wish to broaden bilateral cooperation in various fields on the basis of mutual respect.

The Chinese premier attended China-Central and East European Countries Economic and Trade Forum in Budapest on June 25, where he put forward a five-point proposal to deepen cooperation between the two regions in a speech.

"We are willing to explore all kinds of effective ways of cooperation and will continue to support the development of Central and Eastern European countries," Wen said.

Hungary now serves as the rotating chair of the EU. It is one of China's most important trading partners in Central and East Europe. Bilateral trade between the two countries reached a record high of $8.72 billion last year, increasing by 28.1 percent year-on-year.

Wen calls for closer China-UK ties

Premier Wen also held talks in London with British Prime Minister David Cameron on June 27, as part of the China-UK strategic dialogue mechanism. Wen called for further promoting bilateral ties and more cooperation between the two nations.

Trade deals worth $4.3 billion (3 billion euros), including a $2.46 billion agreement on clean coal projects between China Energy Conservation and Environmental Protection Group and British Seamwell International Ltd, were signed in the presence of the two leaders.

Wen and Cameron signed 12 agreements, which will help British companies to work with China in the areas of architecture, civil engineering, remote sensing satellite and research and development.

Both leaders restated their desire to double bilateral trade to $100 billion by 2015.

During their talks, Wen said maintaining and advancing sound China-Britain relations is conducive to the development of both countries and will play a positive role in reshaping the global pattern.

Cameron agreed with Wen's proposal for closer pragmatic bilateral cooperation, and hoped that the two sides will further open their markets to each other, enhance their exchanges and cooperation in trade and other sectors.

During his meeting with British Deputy Prime Minister Nick Clegg, Wen proposed that China and Britain prioritize their cooperation on the green economy to jointly pursue sustainable development, contribute to world economic recovery and fight climate change.

Wen has also held meetings with former British prime ministers Tony Blair and Gordon Brown, wishing that they could continue playing their part in promoting mutual understanding and cooperation between the two countries.

During his tour of the Chinese-owned Longbridge MG Motor factory in Birmingham, central England on June 26, Wen said China plans to stimulate domestic demand and reduce its foreign trade surplus to encourage balanced trade growth.

Wen also offered two pandas to Edinburgh Zoo as gifts of this trip.

The UK is now China's third-largest EU trade partner, while Beijing is London's second-largest trade partner outside the EU. Bilateral trade in goods reached $50.08 billion last year.

Last November, Cameron took the largest ever British delegation to China, with relations between the two countries expanding in areas of trade, education, science and tourism.

Wen, Merkel hold first round of consultations

Premier Wen Jiabao and Chancellor Angela Merkel held a first round of consultations on June 28 in Berlin, during the final leg of the Chinese leader's five-day European visit.

The consultation, co-chaired by Wen and Merkel, is a dialogue mechanism aimed at further boosting bilateral political trust, promoting trade and economic relations, and deeply involving Germany, the economic engine of the European Union, to promote China-EU relations.

During the meeting, the two leaders agreed to expand trade and investment to attain the goal of $280 billion (195 billion euros) in trade volume by 2015.

China and Germany signed deals worth more than $15 billion. Wen and Merkel attended the signing ceremony in Berlin.

One of the highlights of the ceremony was China's purchase of 62 A320 aircraft from Airbus SAS.

Other contracts, among the 14 deals signed, included an electric car project between German auto giant Volkswagen and its Chinese partner FAW and a factory in Foshan.

China has also decided to set up a 2-billion-euro special loan to support cooperation between Chinese and German small and medium-sized enterprises (SMEs) in the industrial design and research and development of the science, technology, culture and innovative industries.

Wen and Merkel also agreed to continue legal and media dialogues, hold the Chinese Culture Year in Germany in 2012 and strengthen youth exchanges.

Following the consultation, China and Germany issued a joint press communiqu and agreed to lift their strategic partnership to a new level.

Wen made a six-point proposal for pushing forward bilateral cooperation at the sixth Chinese-German Forum for Economic and Technological Cooperation in Berlin on the same day.

China is ready to import more German products and the country hopes Germany will recognize its full market economy status at an early date, Wen said.

China is Germany's fifth-largest export market and the biggest importer of goods into Germany. Bilateral trade volume last year hit 130 billion euros, up by more than 34 percent from that of the previous year. More than 7,000 German companies have been set up in China, with paid-in investment exceeding $17 billion, the highest among EU countries.