Premier Li's visit boosts China-South Korea ties, promotes detente with Japan

SEOUL -- A block away from the hotel where Chinese Premier Li Keqiang stayed in Seoul during his just-concluded visit to South Korea is Dongguk University, a Buddhist-founded school now with quite a few young students speaking Chinese.

South Korea's leading disciplines such as performing arts and filmmaking have attracted swarms of students from China in recent years.

China and South Korea are each other's largest source of exchange students, with about 63,000 Chinese students now studying in South Korea and 62,000 South Korean students in China.

On Monday, the last day of his South Korea trip, Li interacted with youth leaders from both countries and paid a visit to a local innovation hub. In his remarks, he highlighted China's drive of mass entrepreneurship and innovation, which is aimed at restructuring China's economy away from heavy dependence on manufacturing and exports of low-end products.

In his meeting with South Korean President Park Geun-hye on Saturday, Li said China wishes to conjoin its own "Belt and Road" initiative with South Korea's Eurasia Initiative, the idea of mass entrepreneurship and innovation with the South Korean strategy for boosting creative economy, and the "Made in China 2025" initiative with South Korea's "Industry Innovation Movement 3.0".

He also called for joint efforts with South Korea to explore third-party markets in global production capacity cooperation.

Promising to facilitate imports of qualified South Korean specialties like ginseng chicken soup and kimchi, among other farm or fishery produce, Li expressed his hope for an early implementation of the China-South Korea free trade agreement (FTA), which was signed in June.

National Assembly Speaker Chung Ui-hwa on Sunday told the visiting Chinese premier that the South Korean legislature will spare no efforts to finish domestic legislation on the bilateral FTA by the end of this year.

The China-South Korea FTA is expected to serve as a cornerstone for the formulation of a trilateral free trade zone with Japan and, subsequently, the Regional Comprehensive Economic Partnership.

Pledging greater market access for global businesses, Li encouraged leading South Korean multinationals, particularly those with strong competitive edges in electronics and carmaking, to invest more in China.

At the same time, China's central bank announced the decision to raise the investment quota for South Korea under the RMB Qualified Foreign Institutional Investors (RQFII) scheme to 120 billion yuan ($18.9 billion), from its previous volume of 80 billion yuan ($12.6 billion).

The RQFII, launched in December 2011 to widen RMB investment channels for overseas funds on the Chinese mainland, allows qualified foreign investors to invest RMB-based funds in the mainland securities market within a permitted quota.

China is now South Korea's largest trading partner, largest market of exports and largest source of imports, while South Korea is China's third-largest trading partner. Two-way trade is expected to reach 300 billion dollars this year, which will mark a 60-fold increase over the past two decades.

The vibrant China-South Korea economic interaction has manifested itself in massive people flows. For example, there are more than 1,000 flights between the two countries every week. In 2014, they recorded 10.37 million mutual visits of their nationals, a year-on-year increase of 26.2 percent.

Seoul mediated to resume China-Japan-South Korea summitry after a three-and-a-half-year hiatus. The leaders' meetings had taken place annually from 2008 to 2012 before it ran into a standstill largely due to Japanese provocations on territorial and historical issues.

Japan's September 2012 "nationalization" of the Diaoyu Islands chilled its relations with China. Japanese Prime Minister Shinzo Abe's visit to the Yasukuni Shrine, which honors convicted WWII war criminals, worsened Japan's ties with its Asian neighbors.

In a meeting with Abe on Sunday after the tripartite summit, Li demanded that Japan properly handle sensitive issues in bilateral ties under the spirit of looking at history squarely and taking history as a mirror.

Meanwhile, Li called for concerted efforts to maintain and strengthen the positive momentum in the detente between China and Japan, including resuming regular meetings of Chinese, Japanese and South Korean leaders.

Abe expressed his willingness to further improve ties with China based on the four political documents signed by the two countries, saying that Japan will continue to pursue peaceful development based on its reflection of WWII and adhere to the "purely defensive defense" policy.

China-Japan relations have witnessed gradual recovery since the two sides reached a four-point principled agreement in November last year, which paved the way for an ice-breaking meeting between Chinese President Xi Jinping and Abe days after.

At the China-Japan-South Korea summit on Sunday, Li proposed that the three countries cement mutual trust on the premise of forging common grounds on major issues, including historical issues, and take the responsibility of safeguarding regional stability and, in particular, peace and stability on the Korean Peninsula.

In a joint declaration for peace and cooperation in Northeast Asia, issued after the trilateral summit, the three parties reaffirmed their firm opposition to the development of nuclear weapons on the peninsula and to any action that may cause tension on the peninsula or violate relevant UN Security Council resolutions.

Citing their economic complementarity and great potential in production capacity cooperation, Li urged the three sides to explore new cooperation models so as to bringing forth all-win results instead of engaging in cut-throat competition.

In the declaration, the three parties agreed to strengthen their partnership in sustainable growth, financial market stabilization, air pollution prevention and control, infectious disease prevention and control, marine litter monitoring, Arctic research and high value-added industries.

The three countries also promised to share experience and explore economic and sports cooperation for the 2018 Pyeongchang Winter Olympics, the 2020 Tokyo Summer Olympics and the 2022 Beijing Winter Olympics.

Accounting for an overwhelming share of the Asian economy and a significant portion of the global output, China, Japan and South Korea have seen an annual increase of 12 percent in trilateral trade for the past decade, which has resulted in growing interdependence on the backdrop of deepening globalization.

In the declaration, the three neighbors recognized that they have to overcome the situation in which economic interdependence and political and security tensions coexist, so as to build permanent peace, stability and common prosperity in the region.