Visiting Chinese top legislator Wu Bangguo said in Tokyo Friday that mutual understanding and trust are very important to cooperation between China and Japan.

Wu, chairman of China's National People's Congress (NPC) Standing Committee, made the remarks in a speech delivered at a luncheon hosted in his honor by the Japanese business community.

He praised Japanese Prime Minister Junichiro Koizumi for his remarks made at the first annual conference of the Boao Forum for Asia in April 2002. Koizumi said that China's dynamic economic development is not a threat but an opportunity to Japan.

Presenting three major facts, Wu refuted fallacies of the so-called "China threat" and of "China exporting deflation" as groundless.

First, China's gross domestic product accounts for only 3.9 percent of the global total and China's foreign trade volume less than 5 percent of the world's total, Wu said. "China does not have the capability to sway prices and impact on the supply and demand situation in the world market."

Second, Wu said, the main beneficiaries of China's exports are foreign multinationals. Up to 65 percent of China's exports are contributed by overseas-funded enterprises, which are mainly involved in processing trade, with their parent companies controlling the import of raw materials and parts and components and the export of finished products.

"China's foreign trade is to some extent conducted among multinationals themselves and their affiliates in China have become an indispensable link in the supply chain of economic globalization," Wu said.

Third, trade and economic ties between China and developed countries are highly complementary, he stressed.

"China's exports are mainly labor-intensive products that developed countries stopped producing long ago. And consumers in developed nations stand to benefit the most from high-quality but low-priced commodities provided by China," Wu said.

Trade between China and developed nations is mutually beneficial, he noted.

Wu expressed his belief that cooperation between China and other countries will become broader and foreign companies will find more opportunities in China, with the development of China's economy, rising standards of living, constantly improving investment environment and China's huge market potentials.

Wu is in Japan for a week-long official visit.
 
(Xinhua News Agency September 5, 2003)