tv China Behind the Wall Bloomberg September 26, 2015 3:00pm-3:31pm EDT
♪ betty: welcome to this bloomberg special edition, "china: behind the wall." i traveled to china and spoke with a former ambassador to the united states, a leader in the powerful state council, and a top negotiator on foreign policy. we talked with them of the most pressing issues between the two countries, from cyber spying to the most recent market turmoil, but first, we begin on chinese
president xi jinping's much-anticipated visit to the u.s. this is happening a few weeks away from the visit of xi jinping to the united states. what does he hope to accomplish? mr. yang: i believe the areas are very important. first, it is for the leaders to have an in-depth discussion, following the discussion of california and beijing about the international situation, about our respective countries, the policies, and about the future of our cooperation, particularly to charge a way forward, furthering our relationship. we expect that there will be quite a few cooperation results flowing from the visit, what people call the deliverables.
i believe the president will reach out to american society to build the friendship between our two peoples. betty: people have said this visit can be compared to the visit back in 1979. it is that important to the relationship between the u.s. and china. is that accurate? i mean, how critical is this visit to china? mr. yang: that was a historic visit, opening up the relationship between our two countries, and i think this visit is also vitally important. the united states has said and has actually emphasized that they hope that this visit would
be a milestone, putting our relationship firmly on a positive trajectory. betty: americans and the american public still have a mistrust of the chinese. a pew center poll recently said 54% of americans view china unfavorably, so how does the president plan to change that perception? mr. yang: the results of opinion polls change from time to time and from place to place. my understanding of american society is there is a deep awareness of the importance of nurturing a better relationship between our two countries, so i believe that the american people attach a great deal of importance to the visit. of course, we have had some early harvest of this new model of the relationship between us. for instance, the trade between the two countries has grown quite a bit, and there are more
student exchanges between us, and on the international scene, there has been good coordination between china and the united states, from the middle east to some parts of africa, from afghanistan to the korean peninsula, so a better relationship is in the interest of both of our peoples and the world. of course, a relationship cannot be free from any problems. even people sometimes do not see things in a common way, and i think for countries, sometimes they might have some divergence of views. that is not that important, so long as the differences in proper perspective. betty: let's talk about the economy. recently, the chinese government devalued the renminbi, and the markets reacted violently around the world.
is he going to talk about the economy, and how this he described the state of the chinese economy? mr. yang: they will talk about the world economic situation, the economic developers, the respective economies and the economic policies. it is very important on the macro level that the two countries have more coordination of their policies, but let me point out that since the outbreak of the financial crisis seven years ago, people have all worked very hard to revise the world economy. it is not as far as people have expected, but that does not mean that we should not continue our good efforts, and china has done its part. you are no longer having double-digit growth rates.
it just like a high jumper, the higher you go, the more difficult to raise the level. on the other hand, we still have a handsome 7% growth rate here in china. of course, china is not free from its own set of challenges and problems on the economic front. of course, there have been some ups and downs in the stock exchange market, but given china's economic development, given the fact that china is a developing country, some movements on the stock exchange in china should not equal the whole picture of the chinese economy. betty: why devalue the value of the renminbi now, especially close to this visit? mr. yang: i think generally speaking it is quite steady. and we will, of course, continue
to reform in china. in various sectors, including the financial sector, and when people look back 10 years or 15 years from now, we see that the market reform is really good, not only for china, but for the rest of the world. betty: let's see, 12 months from now, will be renminbi be lower in value? mr. yang: it is normal for the currency to move either way, but it is a reliable currency, and more and more people actually do their trades in renminbi, and i am sure that the -- will play a healthy role not only in the chinese community but in trade and so and so forth.
betty: were you surprised by how the markets reacted to the devaluation of the renminbi? mr. yang: let me say this. every country has its challenges and its problems, and every country should do a better job of their own economy. betty: they should mind their own business, right? mr. yang: i do not mean that. the chinese economy is a big one, but it is not that big. there are many players, so there economic performance fundamental he has an impact on the behavior of the financial market and so and so forth, and the difference between china, the chinese stock exchange, and the stock exchange of many western countries is
there are far more institutional investors in the west, and, of course, there is always room for improvement for anybody, so i do hope that people will take an appropriate and calibrated approach to what happens in the world in the financial markets, no matter where it might be, in china or in other countries, so people should be respectful to facts and to be fair. betty: our bloomberg growth index pegs the chinese economy growing at a slower 6.6% gdp, so is, in fact, growth in china slower than what the statistics suggest? mr. yang: i think our statistic is quite reliable.
it is about 7% growth rate. that is our projection. of course, we have to do our level best to make sure the economy will go forward. betty: coming up, china faces accusations of cyber spying on american companies. how do you account for the white house? they say they can trace those cyberattacks back to origins in china. stay tuned for more on my interview with the top foreign-policy official. ♪
i am betty liu in beijing. welcome back to our special "china: behind the wall." some serious issues hang over the two sides, one that is about to blow over, accusations that china is sparing on american companies. i asked counselor yang. mr. yang: they should work together and work out there rules for cyber security and the spirit of mutual benefit and mutual respect. china, itself, is a victim of hacking activities, and the chinese government is firmly against hacking of any kind, and i think every country should take a responsible, prudent attitude and should proceed on factual ground. betty: then how can you account for the white house? they say they have evidence that
recent cyberattacks on the office of personnel management, for instance, the insurance company, they can trace those cyberattacks back to origins in china? how do you account for that? mr. yang: i think it is better to let the american sides tell people their position, but the two sides stay in close touch on this issue, and i believe it is important for any government in the world to adopt a prudent and responsible attitude, and let me say that china is a responsible country. we are firmly against any kind of hacking activities. we are against cyber theft, and china and the united states can work very closely on this issue. that is to make the cyberspace secure, transparent for all. betty: foreign policy is likely
to figure very prominently in the presidential elections in the u.s. mrs. hillary clinton is running for the democratic nomination. recently, we have heard a lot of news around the south china sea, and mrs. clinton, as you know, has made several comments about the dispute. in 2010, she took a harder stance against china and said it was in the american interest to have stability in that area, and i believe she said at the time, there is a concern that we all abide by the international rules, and she was speaking about china at that time, so why has china recently begun reclaiming so much land in the south china sea? mr. yang: we are not reclaiming land in the south china sea. there is been some construction of islands and reefs, so china has a solid, legal ground and
historic facts to back up our position. betty: but america says about two thousand acres of unclaimed land have been added to the island. mr. yang: china has land reclamation on some of these reefs, which are part of chinese territory. but the very purpose of some construction on these islands and reefs is mainly to serve public interests, of course, given the fact that some of our territory is surrounded by military installments of other countries, so there is reasonable ground to have some defense facilities on these islands. betty: there is a military
airport being built on there, right? mr. yang: well, let me say. lots of it, aviation, much of it is for civilian purpose mainly, and let me say that people should take a reasonable stand on it. about the disputes between china and some individual countries in south east asia, we believe that the parties directly concerned should handle and try to solve these differences and through friendly consultation and negotiation, and this is exactly stipulated in the declaration of
conduct to parties in the south china sea. betty: it is my understanding, mr. yang, the philippines filed with the hague, and the chinese have refused to engage in that complaint. mr. yang: because the philippines signed on to it, and china made it very clear that such disputes or similar disputes should be solved by the parties concerned, and we would not participate in any kind of adjudication, as you have mentioned. china made this very clear. not this year or last year. actually, about 10 years ago. china made its position very clear, so i believe it would be good for everybody to keep its word and to do what they have promised.
betty: when you look at the disputes in the south china sea, the chinese sending navy ships up the coast of alaska when president obama was there, and the military parade commemorating the anniversary of the ending of world war ii, some look upon that as increasing military aggression by the chinese. mr. yang: first of all, let me say that the anniversary of the chinese people's war of resistance against japanese aggression and against fascism has been welcomed by the world. the purpose of the celebration is to bear in mind history, to respect the fallen heroes, and to cherish peace and to open up a better future, so this kind of celebration is not directed at any government. his address at the commemorative event, the president actually mentioned peace in a very emphatic way, 18 times, and let
me say that the military of any country should move according to international law, and that has always been china's position. of course, we have certain complaints, about what other countries have done, but facts are facts. facts speak louder than words. betty: with all due respect, mr. yang, we saw missiles and nuclear capable warheads, and they saw the so-called aircraft carrier killer. is that a sign of peace? mr. yang: china is a big developing country, and we need defensive forces to make sure
that our country is secure. there is nothing wrong about that. if you look around the world, you know that it is a very complicated place, and china's military force is for national defense, period. i hope that people will not ascribe some other motives to china's defense establishment and its efforts in the right direction. betty: much more ahead with my conversation with yang, including the presidential race and china's view. mr. yang: there might be some ups and downs, that the general relationship is developing. betty: china behind the wall continues after the break. ♪
relations. mr. yang: there might be ups and downs, but the general direction of the relationship is development. what i have heard from the general public in both countries is that this is a very important visit. we have to make sure that the visit will be a great success. i think that is the true feeling of the two peoples. betty: when the dow plunged, donald trump, who is the leading candidate to win the republican nomination, he came out very forcefully and said this is china's fault, that china made this mess, because they devalued the renminbi, so is the chinese government prepared to deal with a president trump? mr. yang: well, i have just
expressed my views on the financial markets of various countries, and i think that any country should look at the fax and then come to the right conclusion. i am not going to comment -- betty: including mr. trump. mr. yang: i am not going to comment on any particular person's views. when you look at the new york stock exchange, sometimes it goes down. sometimes it bounces back. we wish america well, and they are having quite a recovery of the american economy, and we wish the american economy getting better and better, and it is not good for anybody to point an accusing finger at somebody else. betty: so in 12 months, what would you like to see accomplished? mr. yang: in 12 months' time, of
course, let's work hard to make the president's visit and the heads of state meeting a success. let the message be out and that china and the united states will continue to build this new model of the relationship between china and the united states. i think it is also very important for people to view things from a new perspective. that is we are in the 21st century. the 20th century is a great century, but there are lessons to be learned, as well, so people should adopt a more forward-looking attitude. betty: i have spoken a lot about the concerns of the americans, but i am curious from you. what deeply concerns you the most? what keeps you up at night? mr. yang: well, now in this information age, diplomacy is
going on somewhere while you are asleep or awake, so i have to make sure that things are functioning in a normal fashion, and it is my view that people of the world aspire to a better tomorrow, and it is the responsibility of diplomats both to bridge the gap between various countries and to promote more good interaction among the peoples, and in the face of climate change, energy problems, terrorism, and many other things. i think china and the united states and many other countries should work together. if we all pitch in and do our best, i think the world will be a better place. betty: for more on my interview
emily: it is behind some of the biggest successes in tech history. from facebook to linkedin to airbnb and instagram, greylock opened its doors in boston 50 years ago, but since landing in silicon valley in 1999, it has backed hit after hit. they have backed 170 public companies, four of them worth more than $10 billion. joining me today on this edition of "studio 1.0," greylock partners david sze and john lilly. david, you have been at the firm for 15 years? gues6.