On July 9, 2009, the dialogue between leaders of the G8 and developing countries opened in L'Aquila, Italy to discuss the most pressing issues faced by the international community, including the international financial crisis, the recovery of world economy, climate change, energy security, food security, international trade and development. State Councilor Dai Bingguo, on behalf of President Hu Jintao, attended the dialogue and elaborated China's principled position on those issues.

In his speech, Dai pointed out that the international financial crisis is still sprawling and the world economy has plunged into recession. Although the global economy has shown some positive signs with the concerted efforts of the international community, the recovery of world economy will experience a complicated process with twists and turns. The economic growth of the participating countries has a major influence on the recovery of world economy. It is our primary task and common responsibility to boost the global economic recovery and cope with global challenges jointly. The Chinese side believes major efforts should be made in the following aspects:

First, boosting recovery of the world economy. As economic globalization goes deeper, the macroeconomic policies of countries, especially the major economies, will influence others. When formulating economic stimulus policies, we should consider not only our own interests but also the interests of others. Countries should strengthen communications to ensure the coordination, effectiveness and farsightedness of their macroeconomic policies. Our principal tasks are to implement the outcomes of the G20 Washington and London summits, expand demand, increase employment and maintain the intensity and effectiveness of stimulus plans. It is necessary to open the market, oppose protectionism in whatever form, ensure the regular and orderly flow of goods, services and people worldwide and accelerate the process of WTO Doha Round talks. Meanwhile, new economic growth points should be cultivated to lay down foundation for future growth.

Second, pushing forward reform of the international financial system. The international community has reached consensus on the reform, but the key is implementation. When conducting the reform, we should give top priority to the current needs of stabilizing the international financial market as soon as possible and promoting the growth of real economy, but we should also take a long-term perspective of strengthening the international financial supervision and maintaining the international financial order to prevent the repeat of crisis. We should speed up the reform of governance structures of the IMF and the World Bank, enhance the voice and representativeness of the developing countries and encourage other international financial standard-setting bodies to equally participate in the decision-making; establish and improve the international financial supervision mechanisms, expand supervision, clearly define the supervisory responsibilities, reinforce regulatory cooperation and unify supervisory standards; improve the international monetary system and the issuance regulation mechanism of reserve currencies, keep the relative stability of exchange rates of major reserve currencies and promote the diversity and justice of international momentary system.

Third, promoting the common development of all countries in the world. As the biggest victims of the international financial crisis, the developing countries may also become a major force driving the recovery of world economy. The international community should look at the development issue with a broader vision and more long-term perspective. The international financial institutions should use the new resources first of all to help the developing countries get rid of poverty and provide them with more flexible and convenient credit support. The developed countries should fulfill their official development assistance commitment and offer assistance without any political condition attached to help the developing ones strengthen capacity building and reach the UN Millennium Development Goals (MDGs). Undertaking primary responsibilities for their own development, the developing countries should focus on eradicating poverty through development and balance their development in the economic, political, social and environmental fields.

Fourth, jointly coping with the global challenges. The global challenges such as climate change, food security and security of energy resources are faced by the entire international community and need joint efforts to cope with. On climate change, we should keep the United Nations Framework Convention on Climate Change and its Kyoto Protocol as the major channels, pursue the principle of common but differentiated responsibilities, take active actions in line with the Bali Roadmap and work for the success of the Copenhagen conference on the basis of taking into full account the national conditions, development levels, historical responsibilities and per capita emission of different countries. Concerning food security, we should increase agricultural input, ensure food output, reinforce market supervision, crack down on speculation, focus on alarm monitoring and establish the rescue mechanism. In terms of security of energy, we should forge advanced R&D and dissemination systems of energy technologies, diversify energy supply, stabilize energy price, strike a balance of energy supply and demand, accelerate R&D on new and renewable energies and improve energy efficiency.

He noted that President Hu proposed the international community be committed to building a sustainable world economic system, an inclusive and orderly international financial system, a just and reasonable international trade system and a fair and effective global development system one year ago in Hokkaido. The occurrence and spreading of international financial crisis further prove the importance and urgency of strengthening the construction of those systems. The international financial crisis warns us that only by conducting international cooperation can we resolve the global crisis and only by improving and strengthening global economic governance can we promote the coordinated and sustainable development of world economy as economic globalization moves forward. He then explained the opinions of the Chinese government on the issue of global governance.

I. Goal of governance. The fundamental goal of global economic governance is to push forward the development of global economy in a balanced, universally beneficial and win-win manner. Balance means taking into account the needs and balancing the concerns of both the developed and the developing countries. Universal benefit means maintaining the interests and bringing tangible benefits to all the countries in the world and their people. Win-win means combining the interests and linking the development of one country with all the others.

II. Participants of governance. Global economic governance should be participated in by all the countries around the world. Countries, no matter large or small, strong or weak, rich or poor, are all parts of the global economy and should participate in the governance equally and enjoy relevant representativeness, voice and decision-making rights. Equal participation is reflected not only in form but more importantly in substantial content and decision-making. Only in this way can we ensure the rationality and justice and guarantee the reputation and effectiveness of the global economic governance.

III. Way of governance. Global economic governance requires countries to solve the difficulties caused by economic globalization through consultations and cooperation. It is important to follow the democracy principle, listen to the opinions of all parties concerned, take care of and reflect the interests and demands of all countries, especially the developing ones. We should respect differences, take into consideration the different national conditions of countries and allow different approaches of the developed and the developing countries. We should insist on and advocate cooperation and encourage countries to strengthen communication and coordination and use their advantages respectively to address the common challenges.

IV. Mechanisms of governance. Global economic governance requires appropriate mechanism arrangements. The development of world economy makes it hard for some mechanisms to fully reflect the demands of the international community. Representativeness needs to be expanded to effectively tackle the global challenges. Governance should be targeted at problems in different areas and at various levels. In terms of governance mechanisms, relevant international standards and rules should be formulated on the basis of equal consultations and consensus reached among all the interested parties. Experience and best practices should be disseminated and countries should intensify exchanges and cooperation to jointly build an effective global economic governance structure.

Dai said that the international financial crisis has brought about huge difficulties and challenges to the Chinese economy. China has resolutely adopted a proactive fiscal policy and moderately expansionary monetary policy, worked out the package plan of stimulating domestic demand and promoting stable and relatively fast economic development, launched the RMB4 trillion economic stimulus package and implemented the RMB500 billion structural tax reduction in order to realize the stable and relatively fast growth of the economy. Efforts have also been made by China to readjust the economic structure, strengthen the infrastructure construction, balance the development of rural and urban areas, advance the social undertaking, guarantee and improve people's livelihood and push for the coordinated economic and social progress; comprehensively enhance the industrial competitiveness and independent innovation ability, step up energy and resources saving and ecological environmental protection and promote the sustainable economic growth. So far, those measures have shown initial results. China's GDP grew by 6.1% in the first quarter and urban fixed assets investment increased by 32.9%, total retail sales of consumer goods by 15% and industrial production by 6.3% from January to May this year. China will continue to participate in the international cooperation on tackling the global financial crisis and contribute to the efforts of international community of boosting the recovery of world economy.

He pointed out finally that countries have different national conditions and development levels and do not necessarily hold the same opinion on some issues. But the common responsibility of promoting world peace and development calls us to join hands together. Today we gather in L'Aquila to send a clear signal that we should, and we are able to cooperate.

Leaders of the participating developing countries indicated the necessity of implementing the measures developed at the G20 London summit, strengthening supervision of financial market and continuing to fight against trade and investment protectionism. The international financial crisis has hit the developing countries seriously, especially the African nations. The international community should pay full attention to the exacerbation of global poverty and deterioration of environment and give top priority to the development issue. The developed countries should fulfill their commitment to ensure capital flow into the poor countries. The developing countries should play their part in addressing such issues as accelerating the Doha Round talks and coping with climate change. Balance should be stricken between promoting development and protecting environment.

Leaders of the participating developed countries noted that the international financial market is being stabilized and some positive signs have shown in the world economy. Efforts should be made to comprehensively recover the world economy and prevent the reoccurrence of international financial crisis. Sustainable development should be achieved through innovation. In particular, trade protectionism should be opposed and the Doha Round talks be completed at the earliest date possible. The issue of global governance should be addressed. The international community holds common interest on climate change which cannot be solved without the participation of large developing countries. The developed countries are willing to help the poor nations obtain the development fund and gain access to development channels.