FOREIGN MINISTER WANG YI (translator speaking) Good afternoon. Just now Foreign Minister Bishop and I held the third round of China Australia Foreign and Strategic Dialogue. We had very positive and constructive discussions on all of the issues of shared interest and we also reached more and new important consensus.

Just now the two of us fully applauded the good momentum in China Australia bilateral relations while in particular following President Xi Jinping’s state visit to Australia our relationship has been taken into a new phase of developing a comprehensive strategic partnership. Thanks to concerted efforts we have been expanding the areas of cooperation and deepening the convergence of interests. I would say that all those have brought new substance into this relationship.

This year is the inaugural year of the comprehensive implementation of the China Australia FTA which was signed at the end of last year. We have seen that this agreement has already been playing a very positive role in boosting the business cooperation between the two sides.

The two sides agree to branch out into new areas of cooperation building on the traditional fields of mutually beneficial cooperation.

For instance, the two sides have established a working group to pair up China’s belt and road initiative and the northern Australia initiative. We hope that the working group will intensify this work for early harvest and achieving specific projects of cooperation.

We are also ready to discuss how to bring together China’s innovation driven development strategy and Australia’s national innovation and science agenda so that we can discover and locate new areas of cooperation and bright spots in our relationship. I can think of areas such as agriculture, services, telecommunication technology, energy conservation, environmental protection, management of urbanisation, marine development and economic fields, so on and so forth. We believe that there is tremendous potential and prospects in such cooperation that await to be tapped and translated into real benefits for our economies.

In this globalised world China and Australia are actually neighbours across the sea so people to people exchanges are also very important for our overall bilateral relationship. China supports the New Colombo Plan which was initiated by Madam Foreign Minister herself. We welcome more Australian young students to come and study in China. China will definitely provide facilitation of that. We also encourage more Chinese tourists to visit Australia. Last year the number of visits made by Chinese tourists to Australia exceeded one million. I believe that in the not so distant future China will become Australia’s largest source of foreign tourists.

We also welcome Australia giving positive consideration of providing more facilities to Chinese tourists. We hope that soon this pilot program of giving ten year long visas to Chinese tourists will become an actual policy. We hope to see more measures that streamline and cut the turnaround of visa applications by Chinese tourists. We believe that these measures will go a long way in facilitating the people to people exchange between our two sides which will further serve the longer friendship and common interests between our two countries.

We are also happy with the state of military to military exchanges between our two countries. This is also a key field of building mutual trust between our two countries and very much a part of the comprehensive strategic partnership between China and Australia. We will continue to enhance military to military exchanges and cooperation with Australia. We also stand ready to step up law enforcement cooperation with Australia to together crackdown on corruption and other crimes.

The two sides also agree to strengthen coordination and cooperation in multilateral mechanisms such as the United Nations, the G20 and APEC, and in global economic governance and regional economic integration. We also welcome Australia to participate in this September’s G20 Summit in Hangzhou. We will certainly stay in very close touch to ensure the full success of this important summit.

Thank you.

JULIE BISHOP I am delighted to be in Beijing again to co-chair the Third Foreign Strategic Dialogue with my friend and counterpart, Foreign Minister Wang Yi whom I have met on numerous occasions during my visits to China and around the globe.

We have had a wide-ranging discussion which we will continue shortly over lunch as we look ahead to planned visits by Prime Minister Turnbull to China and Premier Li to Australia.

Australia and China enjoy a comprehensive and strategic partnership and this is manifesting in many positive and beneficial ways. Our free trade agreement has entered into force and is already benefiting businesses and consumers in both countries. Both Governments are committed to increasing two-way trade and investment.

Education is a high point of our people to people exchanges. There are more than one hundred and thirty thousand Chinese students in Australia and a growing number of Australian students in China. We expect this number to increase under our signature initiative the New Colombo Plan, which will support and encourage thousands of young students to live and study and work in China. Indeed, in just the first two years of the program around two thousand Australian students will study in China.

We have a record number of travellers between our countries in both directions. More than one million Chinese visited Australia in 2015 and you are right Foreign Minister Wang Yi, we are trialling a new ten year visitor visa with China and a fast track turn around for processing visas and we hope that that will enhance the tourist potential that China offers.

In response to tragedy and the search for Malaysian airlines MH370 we are working together as partners to resolve one of the great aviation mysteries of our time. In fact a Chinese vessel is in Fremantle Harbour, in my home state of Western Australia, currently to join the search effort.
As partners in Defence cooperation we are seeing more joint exercises and navy ship visits. The same applies to law enforcement where we enjoy good cooperation in accordance with our respective legal systems.

As we look ahead, we are developing our partnership in many areas in more diversified trade, in investment, in education, innovation, science and beyond and this will be the focus of Prime Minister Turnbull’s visit here to Beijing.

In the international arena Australia will continue to engage closely with China through the United Nations, APEC, the East Asia Summit and of course we will work closely with China as the host of the G20. We both recognise the G20 as the premier economic forum vital to boosting global growth, encouraging investment in infrastructure and creating jobs. Australia is a founding member of the Asian Infrastructure Investment Bank which has made a positive start under China’s leadership. We also acknowledge China’s major contribution to international climate change negotiations.

We have also discussed a range of crucial regional security issues including North Korea and the South China Sea. We had a candid exchange of views on these issues. China and Australia share a common interest in the maintenance of peace and stability in our region. In that context we also discussed opportunities for more joint initiatives in the area of aid and development, particularly in the Pacific.

The purpose of this meeting is for our two countries to discuss our common interests and also to discuss areas where we may have different views. We do so as friends, forthrightly but with mutual respect and within the context of this exciting and thriving bilateral relationship.

At a time of economic transition China will find in Australia a reliable partner in trade and investment. The Australian government is committed to boosting this relationship and working closely with China in the years ahead and that is why I am so pleased to be here in China to advance this comprehensive strategic partnership, a most important relationship for Australia.

I thank Foreign Minister Wang Yi for his gracious hospitality during my visit.

JOURNALIST Thank you for this opportunity. I would like to address this question actually to both Foreign Ministers. Australia is forging closer strategic ties with Japan and the United States and this could possibly in future involve the purchase of Japanese submarines.

Minister Wang, do you see this as part of efforts to contain China’s rise and furthermore what is your response to reports that China has deployed surface to air missiles on Woody Island, or Yongxing Dao in the South China Sea.

Minister Bishop, I would like to ask afterwards what Australia’s reaction is to these reports in terms of regional tension. Thank you.

FOREIGN MINISTER WANG YI (translator speaking) Japan was the country that was defeated during the Second World War and that is why for decades it has been asked to follow very strict constraints under a pacifist constitution and its domestic laws in terms of exporting weapons to other countries and cooperation in this regard. So we do hope that in its military cooperation with Japan, Australia will take into full account this historical context and take into consideration also the feelings of the people of Asian countries because of that part of history. We hope that Australia will use its concrete actions to support the peaceful development of Japan and Japan's efforts to uphold this pacifist constitution, not otherwise.

As to your question about whether that move, of buying Japanese submarines, will constitute an act to contain China's rise, I don't think that is the intention of Australia's policy and I actually don't think that any country or force in the world can stop that rise.

About your second question, this is something that we were just being told several minutes ago, that there are reports like that and we believe that this is an attempt by certain Western media to create news stories. I also hope that the media everywhere, including those in Western countries and Australia, will turn your attention more to the lighthouses that we have built on some of the islands and within the South China Sea, which are in operation now. They have been very useful in ensuring the safety of the passing ships in those waters and you can also pay more attention to the meteorological forecast facilities and the facilities that we are planning to build for providing shelter, for providing assistance and rescue and emergency response to the fishing boats in those waters because I think all of those are actions that China, as the biggest littoral state in the South China Sea, has undertaken to provide more public goods and services to the international community and play its positive role there.

As for the limited and necessary self-defence facilities that China has built on the islands and reefs, stationed by Chinese personnel, this is consistent with the right to self-preservation and self-protection that China is entitled to under international law so there should be no question about that.

The Foreign Minister just now mentioned the MH370 tragedy, so let me once again say here how appreciative China is to Australia about the understanding, support, assistance and contribution that Australia offered throughout the process and I would like to say that I believe that through the concerted efforts of all parties including China, Australia and Malaysia we will definitely, one day, find out the truth about the incident.

JULIE BISHOP Just in answer to the question, it should be apparent that Australia is enhancing its strategic relationships with a number of countries in our region, including China. We've just spoken about our increased defence and military cooperation, increasing number of joint exercises and so Australia is seeking to enhance our strategic relationships with a range of countries in our region and beyond.

We have a need to upgrade our submarine fleet and Australia has invited bids from three countries, including France, Germany and Japan. A comprehensive evaluation process is underway and our interests are in obtaining a new submarine fleet that meets our capability requirements, our technological requirements, in terms of range and capacity, and that's what will drive the competitive evaluation process that is currently underway.

Australia welcomes China's peaceful rise. We recognise China's right to take a strategic leadership role in the region, commensurate with its extraordinary economic growth.

In relation to the second part of your question, we had a very forthright, candid discussion about the South China Sea. Australia's position, both publicly and privately, is consistent. We do not take sides on the competing maritime territorial claims in the South China Sea. We have an interest in maintaining peace and stability in the South China Sea, as does China and the other claimants. We urge restraint and we urge that all parties settle their differences peacefully.

Australia respects the right of parties to negotiate or indeed, arbitrate. In the case of the Philippines' arbitration, they are seeking a ruling on whether reclaimed islands generate maritime zones. They are seeking a clarification of international law. They are not seeking a determination on the merits of the respective maritime claims. So I reiterate, Australia does not take sides on the competing claims.

We also welcome President Xi's statement that China does not intend to militarise these islands.

JOURNALIST Well, Foreign Minister Wang, the international community is currently following very closely developments on the Korean peninsula and we know that consultation is going on at the UN Security Council regarding the adoption of a new draft resolution of sanctions against the DPRK. So how can actions be taken to resolve this difficult situation at the moment and can you further share with us China’s position on this issue?

FOREIGN MINISTER WANG YI (translator speaking) Well before coming to that, let me add a quick comment on the South China Sea. Non-militarisation is certainly in the interest of all parties but non-militarisation should not be just about one single country nor should double or multiple standards be exercised when it comes to non-militarisation. And I think this requires the common efforts of all countries both inside and outside this region. And we have noted that at the just concluded US-ASEAN summit, the two sides committed to non-militarisation and we do hope that this commitment will be matched with actions.

I appreciate what Foreign Minister Bishop just now said about Australia's position on the South China Sea, that is Australia does not take sides and it advocates peaceful solutions to these disputes.

As for the arbitration case filed by the Philippines, well since we do not have much time today, I won't go from the very beginning on China's position regarding this issue. But I do want to say that China is actually following the law by not accepting arbitration regarding sovereign and maritime entitlements because after joining the UNCLOS in 2006, China issued a declaration according to the rights given to China by the Article 298 of the UNCLOS. We issued a declaration excluding China from being subjected to the compulsory settlement measures by way of making a government statement and it is a stated position of the Chinese side so of course the Chinese government will continue to stand by that declaration.

Let me also point out that China is not the only country that has issued such declarations. Altogether there are 30 to 40 countries around the world that have issued similar declarations and Australia is also one of them. That is why we believe that what the Philippines is pursuing is actually not legitimate and it knows that this is not something legitimate to do, and it is not consistent with the international practice of bringing up cases of arbitration because the Philippines, before taking that move, did not ask for China's consent or consult with China. It also contravened the bilateral agreements between China and the Philippines about seeking settlement of those disputes through bilateral dialogue and it is also in violation of Article 4 of DOC which the President of the Philippines put his signature on and according to this Article, territorial disputes should be resolved by the countries directly concerned through bilateral dialogue and negotiation. This is why we believe that what the Philippines is doing is not, and will not be, valid and we cannot help but ask whether there is a more complicated international context or a hidden political agenda behind the Philippines' move.

I think the question you raised about the situation on the Korean peninsula is a very good one because indeed, facing the tensions mounting on the Korean peninsula we do need to think seriously about what should be done about the situation and the nuclear issue on the peninsula. This is a question that should have some serious thinking for all countries.

In this day and age, no hot-spot issues can be fundamentally resolved through sanctions or pressure alone and the use of force is a still less desirable option because it can only bring about more serious consequences than the issue itself. This is why the Chinese government has always been committed to resolving hot-spot issues through political means and I believe that such efforts are also consistent with the provisions in the UN Charter about peaceful settlement of disputes. It also serves the interests of all parties concerned and the rest of the international community.

Recently we've been hearing comments drawing analogies between the Iranian nuclear issue and the Korean nuclear issue. But I would say that the reason why we have been able to resolve the Iranian nuclear issue is exactly because we have had a decade-long process of dialogue and negotiation while those Security Council resolutions were being implemented, which eventually led to the conclusion of the JCPOA. However, the current situation on the peninsula exists because the six-party talks have been broken down for eight years. This is what has caused the current situation, which nobody would like to see. So this is why I believe that as we discuss the new draft resolution at the Security Council it is also important to include discussions on the resumption of talks.

The DPRK's nuclear test and satellite launch constitute a series of moves against Security Council resolutions so the DPRK needs to pay the necessary price. The purpose of the ongoing discussions at the Security Council of adopting a new resolution is to stop the DPRK from going any further down the path of developing nuclear weapons. At the same time, however, it is important to make sure that no party will give up the efforts of resuming peace talks or drop their responsibility for maintaining peace and stability on the peninsula.

Of course, China does not bear the cross of the issue on the Korean peninsula. However, as the host of the six party talks, China has always upheld a fair and just position in seeking all kinds of possibilities with other parties how we can try to reactivate the peace talks. And this is why China has proposed this negotiation approach of advancing demilitarisation and replacing the armistice mechanism with a peace mechanism in parallel. And the aim is really to address all parties’ concerns in a balanced way, to identify the objectives of the negotiation and to discover as quickly as possible breakthroughs that could be made to get the talks restarted. I believe this is the only reasonable thing to do. And this will help bring about a fundamental solution to the nuclear issue on the peninsula.

And China stands ready to have detailed and more in depth discussions with all other parties in due course.

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