Wen tells Merkel: China to back up euro

08:36, June 29, 2011      

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Chinese Premier Wen Jiabao and German Chancellor Angela Merkel chat as they stroll in the garden of Villa Liebermann in Berlin yesterday. Wen wrapped up his two-day visit to Germany and left for Beijing with practical outcomes on cementing bilateral ties. Wen and Merkel agreed that they should work together to promote the global economic recovery. The countries also signed a series of contracts and agreements worth about US$15 billion. Germany was the last stop of Wen's Europe tour, that also took him to Hungary and Britain.(Shanghai Daily Photo)

Premier Wen Jiabao told German Chancellor Angela Merkel Tuesday that the two largest economies in Asia and Europe could forge even closer economic and trade ties, as the two leaders reiterated belief they would back up the euro.

Wen offered Europe a "helping hand" to tackle its debt crisis during a visit to Berlin Tuesday, saying Beijing could buy the sovereign debt of some troubled euro-zone nations if needed.

Wen said that China is confident in Europe because it includes countries such as economically and technologically strong Germany, and it has a skilled work force. He said the current difficulties faced by Euro-zone countries are "only of temporary nature".

Merkel assured Premier Wen that Germany will do everything in its capacity to ensure euro-zone countries' competitiveness.

Also Tuesday, the two leaders launched the first round of Sino-German inter-governmental economic and trade consultations. Beijing and Berlin said the two countries will vigorously promote economic ties, aiming at $280 billion trade between them by 2015 which is expected to bring huge benefits for the two peoples.

Wen made it clear that the main point of the meeting between Chinese and German ministers and economic officials in Berlin was to "boost the growth potential of bilateral trade and to once again double our bilateral trade volume in five years."

China and Germany signed deals worth $15 billion Tuesday.

Wen told a news conference that Beijing has confidence in the 17-nation currency, the euro. "China has expressed support for Europe at various times. In other words, when Europe is in difficulty we will extend a helping hand from afar," he said. "We will, according to need, definitely purchase certain amounts of sovereign debt."

Capital Economics estimated in a research note that China has bought more than 40 billion euros (US$57.45 billion) of euro-denominated assets this year, much of that in peripheral economies.

About a quarter of China's record foreign currency reserves of more than US$3 trillion are estimated to be held in euro assets and China has reiterated its confidence in the euro since the debt crisis began.

Wen visited Germany on the final leg of a European tour taking in Hungary and Britain. It was the first time China and Germany - the world's two biggest exporting nations - had held full ministerial consultations aimed at boosting trade.

Germany hopes for a rebalancing of investments between the two countries, with Germany's direct investments in China now standing at 20 billion euros, compared to Chinese investments in Germany of only about 600 million euros, German officials said.

Wen took 16 ministers with him on the visit to meet their German counterparts, including Zhang Ping, chairman of the National Development and Reform Commission, Commerce Minister Chen Deming, and Governor of the People's Bank of China Zhou Xiaochuan.

"The large scale of the lineup, the wide range of topics up for discussion and the substantial achievements are all pioneering work in the history of Sino-German relations and Sino-EU relations," Wen said during a joint press briefing with German Chancellor Angela Merkel.

"China has viewed Germany as an important strategic partner and such a strategic relationship will only be enhanced, rather than weakened, by such efforts," Wen said.

By People's Daily Online
 
 
     
 
 
 
     
 
 
 
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(Editor:梁军)

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