Vice-Premier Li Keqiang's official visit to Spain, Germany and the United Kingdom, which is due to start on Tuesday, marks an important step toward developing closer ties with the European Union (EU) and strengthening pragmatic cooperation.

The weeklong visit is expected to further deepen mutual understanding with the 27-member bloc, expand bilateral economic cooperation and help lay a solid foundation for consolidating and developing an all-round strategic partnership.

The establishment of the market economy in China and the continuing improvement of its domestic investment environment have promoted extensive and fruitful industrial and investment cooperation between China and the EU, which will be a driver for cooperation.

Two-way investment has increased by a large margin over the past decades. The EU is now China's fourth largest source of foreign capital. By the end of 2009, EU members had established 31,874 ventures in China, with a total investment of $68 billion. China's investment in Europe has also mushroomed in recent years. By the end of 2009, the country's direct outbound investment covered almost all 27 EU members, with an accumulated investment of $6.28 billion, and nearly 1,400 Chinese-funded ventures had been set up in European countries, employing about 15,000 local people. In 2009 alone, EU-bound investment reached $2.97 billion, about 5.3 percent of China's total outbound investment volumes, a 5.35-fold increase year-on-year.

Bilateral cooperation on some major high-tech projects has also produced some remarkable achievements over the past years. The establishment of an A320 assembling line in Tianjin marked a major breakthrough between China and the EU in aviation cooperation. From 2005 to 2009, China purchased from Airbus a total of 410 A320 planes. During President Hu Jintao's state visit to France in November, the Chinese side struck a deal to purchase an additional 102 planes from Airbus. China-EU cooperation in the railway, auto, steel and petrochemical sectors has not only helped China learn advanced technologies and management expertise, but has also brought huge economic benefits to European countries.

The strong economic complementariness between China and the EU augurs broader prospects for bilateral industrial and investment cooperation. China is now striving to transform its economic development model, set up a modern industrial system and sharpen the core competitiveness of its enterprises. It is also committed to building a green economy and low-carbon society. All this leaves a wide space for expanded cooperation with EU countries.

The EU has taken the lead in many technologies including low-carbon industries. The "EU 2020 Strategy" shows its determination to develop a green and sustainable economy on the basis of knowledge and innovation.

China and the EU should grab the opportunities brought about by the global financial crisis, and the accelerated global economic transformation, and industrial upgrading and try to surmount obstacles on their way to further cooperation. For the EU, it should recognize China's full market economy status as soon as possible and relax restrictions on high-tech exports to China. And China should further strengthen its intellectual property rights (IPR) protection efforts and improve its investment environment in a bid to achieve a new stage of industrial and investment cooperation with the EU.

China's economic boom has been the result of its determined reform and opening-up drive over the past decades. Chinese enterprises are also encouraged to invest in suitable destinations in EU countries.

The author is vice-minister of the National Development and Reform Commission.

(China Daily 01/04/2011 page8)