Distinguished guests, ladies and gentlemen,

Good afternoon!

My topic is the transformation of city diplomacy in the new era. I am going to talk about the transformation in three aspects and about China's city diplomacy direction of development.

First of all, the mechanism of city diplomacy is in transformation. The central government has been delegating and empowering local governments to economic development and importing resources such as capital, market and talents. The support from central governments and internationalization allows local governments to improve their international development strategies with more incentives and power. However, there are challenges to this process nowadays.

1. Decentralization of governments' power to intervene in the market. The new government of China is making efforts to facilitate the transformation of government function and reduce over-intervention. For instance, the establishment of Shanghai Free Trade Zone will change the situation in which strong governments intervened a lot in economy.

2. The focus on improving life of general people. With the gap of wealth becoming wider, the government has been dedicated to a harmonious society. Thus, city governments have to invest more in public welfare, environmental protection and maintenance of stability, which means city diplomacy enjoy less support.

3. Reform. In the past two years, we have seen unprecedented anti-corruption measures. Such new trends are affecting city diplomacy as funds for city diplomacy are shrinking. This could improve the quality of foreign activities but at the same time restrict the support to internationalization. The central government is also taking back some of its powers, which limit the discretionary power of local governments.

Secondly, the expectations of central government on city diplomacy are transforming.

1. Great power diplomacy. China is becoming a power in the world and cities should contribute more to its diplomacy, for example, by attracting major international organizations.

2. Public diplomacy. China now has good relations with most governments. But the social basis for the relations is not concrete enough. Many foreign nationals are still holding prejudice on China. Neighboring countries are worrying about China's rise. As a result, the central government wants to put emphasis on public diplomacy and city diplomacy.

3. Expectations for aid diplomacy. China has becoming an aid-giver from an aid-receiver. For local governments, to gain support from outside is the main motivation for city diplomacy. With the transformation of national diplomacy, Chinese government needs to expand our friendship network in the world, sharing our experience and providing funds. So that we can help each other and do more to our aid diplomacy.

Thirdly, the transformation of local demands in international relations. In the past, local governments focused on attracting investments and exporting goods. Now, China has become a major country in manufacturing industry and energy consumption. With the cost of labor increasing, the local demand in international relations is changing, especially in coastal cities. For these cities, what's the next step?

1. How to develop our high-end manufacture industry?

2. How to internationalize our service sector?

3. How to internationalize our technical innovation?

4. How to internationalize our management to the open economy?

Fourthly, I would like to propose that the future of China's city diplomacy lies in four highlands and for platforms.

1. Highlands for global governance. This means to facilitate cities to attract more international organizations and forums. Shanghai is becoming headquarters of BRICS Development Bank. This is a key step for Shanghai. You cannot totally decide whether you can attract these organizations and how well you can operate. But cities must provide an environment that is good enough for such organizations.

2. Highlands for global economy. City should become the resource center, pricing center, and communication center and transportation hub. Shanghai raised the concept of Four Centers, which means the economy center, financing center, trading center and shipping center. If Shanghai could become such a highland for global economy, China would become more influential.

3. Highlands for global innovation. For coastal cities, how to establish a better ecosystem for innovation?

4. Highlands for global talents. In the process of development, we need more talents from both home and abroad. There are still barriers in this field and we have to figure out how to overcome these obstacles.

5. Highlands for global system.

6. Platform for China public diplomacy.

7. Platform for China's development and cooperation with others. There is still a long way to go, but we need the courage and determination.

Thank you.