Li says Beijing will keep buying European bonds

Visiting premier says relationship will grow despite uncertainty of Greek debt crisis

Premier Li Keqiang met with Martin Schulz, president of the European Parliament, in Brussels, Belgium, June 29, 2015. [Photo/Xinhua]

Premier Li Keqiang said on Monday that China will continue to buy European bonds, and he added that the Greek debt crisis will not weaken Beijing's determination to further boost its links with the European Union.

"The Greek debt crisis is at a critical stage. This is not only an issue for Europe, but also an issue related to the China-EU relationship and the world," Li said during a meeting with European Parliament President Martin Schulz in the Belgian capital, Brussels.

"We have long supported the integration of the European Union. We will continue to be a supporter of European bonds, and we hope that the Greek crisis can be resolved properly."

China accelerated the pace of its bond portfolio diversification after the 2008-09 financial crisis by increasing its holdings of European bonds. Before then, it bought mainly US Treasury bonds.

Li arrived in Brussels on Sunday at the start of a five-day trip to attend the EU-China Summit and meetings in Belgium and France. However, the worsening Greek crisis forced European leaders to focus on seeking an emergency solution, and the schedule for Li's one-day visit to the EU's headquarters faced last-minute changes.

Li vowed that the situation will not weaken the links between China and the EU, a relationship that is celebrating its 40th anniversary this year, and he said the two sides have "intertwined destinies". China and the EU are each other's most important trade partners.

At the China-EU Business Summit, Li also said China wants Greece to stay in the eruozone and has made tremendous efforts to support this.

"We are keen to keep Greece in the eurozone and we think China-Greece relations are also part of China-Europe relations," said Li.

"It is in our interests that there is a united European Union, prosperous Europe and strong euro."

In recent weeks, Greece and the other eurozone countries came close to reaching an agreement on bailout terms, but on Friday, Greek Prime Minister Alexis Tsipras called for a referendum on the issue on July 5.

The European Central Bank has decided not to extend emergency funding, and the Greek government has ordered the country's banks to close for a week. Greece is scheduled to make a 1.6 billion euro ($1.78 billion) payment to its international creditors on Tuesday, the day its bailout will expire.

European Commission President Jean-Claude Juncker, whom Premier Li met, said the announcement of a referendum has "unilaterally" broken the talks.

The Greek authorities said capital controls introduced by the government do not apply to those wishing to withdraw money from ATMs or carry out any other type of transaction using credit or debit cards issued abroad.

The dramatic developments have raised concern among Chinese and Europe-an business leaders.

Emma Marcegaglia, president of Business Europe, said the EU is in a difficult situation.

"The Greek government should take responsibility and take action to achieve structural reforms," she said. "Spain and other countries have done so, and Greece should follow."

He Jiwen, CEO of Guangzhou Yuetong Solar Technology Corp, said the Greek debt crisis is a result of the decline of the European economy.

"Its derailment from the trend of global economic development is the main reason for this crisis.

"In order to overcome the crisis, Greece has to rely on no one but itself."

Contact the writers through fujing@chinadaily.com.cn