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China-Japan trade ties have great potential
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Thanks to joint efforts by both countries, economic and trade relations between China and Japan have registered rapid growth since China adopted the reform and opening-up policy in 1978.

As each other's key trade partner, the two nations have become increasingly interdependent. Japan has long been China's most important trade partner. During the 11 years since 1993, Japan had been China's biggest trade partner. In 2007 China was Japan's biggest trade partner, while Japan became China's third biggest trade partner, with their two-way trade keeping two-digit growth.

According to statistics released by China's Ministry of Commerce, two-way trade between the two countries climbed by 13.8 percent year-on-year to $236 billion in 2007. Japan became China's biggest exporter and its fourth biggest export market.

The growing bilateral trade volume has also led to changing trade pattern between China and Japan, as mechanical and electrical products with higher technology content have gradually taken the place of products with low value added such as raw materials and textiles.

According to statistics by both countries, mechanical and electrical products accounted for more than half of their trade volume in 2007, an indication that the two countries have become more interdependent in their economic growth.

Moreover, along with China's economic growth and technical advance, Japan has increased its total investment in China and broadened the spheres for its investment in the country.

Figures published by China's Ministry of Commerce show that Japan's investment in China had reached $60.7 billion by 2007. Its direct investment in the country has also undergone a shift from processing industries such as raw material and foodstuff to manufacturing such as mechanical and electrical industry.

During this period, many Japanese electrical and mechanical manufacturers moved their production bases to China one after another. Recent years have witnessed rapid growth of investment in R&D, financial service, logistics and marketing, becoming a new source for economic growth.

A large number of Japanese enterprises are doing brisk business in various industries and different regions in China, reaping sizable investment returns. While spurring Japan's economic recovery and growth, they help boost China's technical progress, and improve the management and logistic and marketing services of China's enterprises.

In addition, the Japanese government has contributed to the development of China's infrastructure and environmental protection and its education and poverty reduction through Japanese yen loans and free aid.

As the second largest economy in the world, Japan has sophisticated technology in energy-saving and environmental protection and rich experience in implementing technology-oriented nation building strategy. As the biggest developing country, China has a market with enormous demand. Therefore, the two countries are highly complementary to each other in their economic growth and their economic, technical and trade cooperation have tremendous potential and will further develop in a deep-going manner.

The exchanges of high-level visits, including the three visits -- dubbed "ice-breaking," "ice-thawing," and "spring-heralding" tours -- by leaders of both countries, have warmed up the China-Japan relations.

The establishment of China-Japan high-level economic dialogue mechanism has offered better environment for the further growth of bilateral economic and trade relations.

The Chinese government's commitment to sustained development, characterized by harmonious relations between man and nature, and greater emphasis on environmental protection, energy-saving and the better quality of economic growth, will provide broad vistas for the economic cooperation between the two countries.

A retrospection of the China-Japan economic development in the past decades shows that the two nations will be able to patch up rifts and come to a win-win solution as long as they adhere to the principle of equality and mutual benefit, friendly cooperation, as well as dialogue and consultation.

(Xinhua News Agency May 5, 2008)
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