(November 18, 2011, Bali, Indonesia)

I am delighted to come back to the beautiful Bali Island and discuss with you, leaders of ASEAN, Japan and the Republic of Korea (ROK), cooperation and development in East Asia. I wish to express sincere thanks to President Yudhoyono and the Indonesian government for their hospitality.

At present, the underlying impact of the global financial crisis still persists. Economic recovery in some developed countries lacks momentum, and those countries are plagued by serious debt problems. Emerging market economies and developing countries face growing inflationary pressure. There is turbulence in West Asia and North Africa. Climate change, food security, natural disasters and other global issues are becoming more pronounced. All these factors have made the prospects of the global economy uncertain and unstable.

ASEAN has made important headway in its integration process in recent years, thus enhancing its overall strength and influence. Countries in East Asia have helped each other, enhanced cooperation and jointly pursued development. Together, we have successfully navigated the international financial crisis, maintained fairly fast economic growth and financial stability and deepened economic integration in our region. The ASEAN Plus Three (10+3) cooperation has played an important role in this regard. On the other hand, we need to recognize that East Asian countries, to varying degrees, face arduous tasks of adjusting economic structure, improving people's life and enhancing the capacity for sustainable development. Development is still quite unbalanced in our region. Confronted with an unfavorable external environment, it is important for us to take stronger measures to enhance cohesion, increase internal growth momentum, and deepen cooperation to improve our ability to defuse risks and raise the comprehensive competitiveness of our region as a whole. By doing so, we can better position ourselves in a changing international environment.

To this end, I propose that we take the following steps:

First, we should accelerate trade liberalization and facilitation in our region. Last August, China and Japan jointly put forward the initiative on accelerating the building of the East Asia Free Trade Area (FTA) and the Comprehensive Economic Partnership for East Asia. China is ready to accelerate this process in a pragmatic way on the basis of fully respecting ASEAN's centrality, following a phased approach and accommodating each other's concerns. China looks forward to the support from all parties in this endeavor. We should make good use of the Special Fund for East Asia FTA Research and promote substantive progress in related fields.

Second, we should raise financial and monetary cooperation in our region to a higher level. The 10+3 financial and monetary cooperation has achieved notable progress and has bright prospects. The Agreement on Chiang Mai Initiative (CMI) Multilateralization has entered into force. The 10+3 Macroeconomic Research Office has been opened and smooth progress has been made in establishing the Regional Credit Guarantee and Investment Facility. Research on future priorities in financial and monetary cooperation has been launched, and the 10+3 Finance Ministers' Meeting will turn into the 10+3 Finance Ministers and Central Bank Governors Meeting.

In the next stage, we should make the CMI Multilateralization more effective and expand its function from crisis rescue to crisis prevention. We should transform the self-managed reserve pool into real pooling so as to bring into full play the role of the reserve pool. We should improve the economic monitoring capacity of the 10+3 Macroeconomic Research Office, actively promote the building of the Asian Bond Market and facilitate the issuance of local currency-denominated bonds, so that savings in Asia will be invested more in our region and in the real economy to promote economic development in East Asia.

We should also carry out more research on new areas such as settlement of regional trade in local currencies, and seek better ways to reduce time and cost of trade and mitigate the impact of the international financial crisis in the region. We should actively promote the building of a regional financial safety net and improve East Asian countries' capacity to guard against financial risks.

Third, we should increase input in East Asia connectivity. China, Japan and the ROK should enhance coordination and form synergy, and tap into our strengths in capital, technology and human resources. We can thus better support the implementation of the Master Plan on ASEAN Connectivity, promote connectivity in East Asia and lay the foundation for East Asian integration.

China supports Thailand's initiative on 10+3 Partnership on Connectivity, and will host an international symposium next year with the theme of "10+3 Connectivity: Consensus and Prospects." We will use it as a platform to further discuss ways to conduct 10+3 cooperation on connectivity.

We should be innovative in thinking and provide flexible and multiple ways to finance infrastructure projects. The 10+3 countries have decided to carry out a study on financing regional infrastructure development. We hope such study will produce a concrete outcome at an early date.

Fourth, we should shift the growth model and promote sustainable development in our region. The 10+3 process should enhance cooperation in science and technology, new energy, energy conservation and environmental protection and provide support and help to countries, particularly developing countries in East Asia, in achieving sustainable development. To this end, China will hold a 10+3 forum on innovation next year to discuss ways to promote innovation and accelerate the shifting of the growth model.

This year witnessed the official signing of the 10+3 Emergency Rice Reserve Agreement by the 10+3 countries. China is willing to work with other parties to actively implement this agreement and further enhance East Asian cooperation on food security. China is ready to enhance cooperation in health with ASEAN, Japan and the ROK, make effective use of the 10+3 Information Center on Emerging Infectious Diseases and build in phases a communicable disease prevention and control focal point mechanism.

East Asian cooperation is at a crucial stage. It is in the interest of all of us to uphold ASEAN's centrality, pursue the goal of development, mutual benefit and win-win outcome and continue to promote East Asian integration with 10+3 as the main vehicle. Next year marks the 15th anniversary of the launch of the 10+3 cooperation process. China will hold a commemorative symposium, publish a collection of documents on 10+3 cooperation, and is ready to chair the Network of East Asian Think Tanks. We will take the 15th anniversary as an opportunity to enhance confidence, solidarity and coordination, and raise 10+3 cooperation to a higher level.