ChinesePremier Wen Jiabao said Sunday that China's control over the exporting of rare earth elements is the result of excessive development and smuggling, while urging Japanese firms operating in China to raise wages for workers.
Wen's comments were made in a statement Sunday after his meeting with a Japanese delegation led by Japanese Foreign Minister Katsuya Okada, in Beijing over the weekend to attend a two-day China-Japan High-Level Economic Dialogue.
As a leading producer of rare earth elements, which consist of 17 metals widely used in the production of mobile phones, hybrid motors, computers and other high-tech components, China had issued export quotas for 30,258 tons by the end of July, down 40 percent compared with last year.
Japanese foreign ministry spokesman Satoru Satoh said at a press conference Saturday that by driving up global prices of these important materials, Chinese export restrictions are affecting the global production chain, with the affected including Chinese computer factories importing computer drives from Japan and other countries.
While admitting the adverse impact of the policies on China's own market, Chinese Commerce Minister Chen Deming said Saturday that in order to protect the country's environment, China has no choice but to take such measures, which are compatible with rules of the World Trade Organization.
"The mass extraction of rare earths will cause great damage to the environment; that's why China has tightened controls over rare earth production, exploration and trade," Chen said.
However, China "will not stop exporting rare earth metals," Wen noted.
Beyond that, both sides are also cooperating in recycling rare earths from abandoned cell phones and computers, and China expects the participation of Japanese firms in recycling, Satoh said.
This year's high-level talks also addressed Japanese concerns over the high-profile strikes in China this year, which have generally involved complaints from Chinese workers over long working hours and low wages.
Citing more than 100 strikes occurring this year at Japanese factories in China, Japan expressed concerns, as the strikes have brought operational difficulties to the firms, and suggested clearer labor laws and industrial-relations rules in China, according to Satoh.
The Chinese side responded by saying it is understandable for workers to request wage increases, especially after two years of frozen wages amid the financial crisis. The minimum wages for workers have been raised in more than 20 provinces in recent months.
"Labor disputes have been occurring at some foreign companies, but behind the scenes lies the problem that wages are relatively low," Wen was quoted as saying in the statement. "I hope you (Japan) address this issue."
The high-level economic-dialogue mechanism was established in 2007 in order to promote a "mutually beneficial relationship based on common strategic interests" between the two rapidly growing economies.
With the previous two dialogues held in Beijing and Tokyo, respectively, the third dialogue this year was co-chaired by Okada and Chinese Vice Premier Wang Qishan, and both sides exchanged views on bilateral cooperation, as well as on global and regional cooperation, and signed seven memorandums of understanding on energy-saving, logistics, talent training, manufacturing, food security and trading.
Moreover, covering cooperation in oil and gas development, search and rescue, and the communication mechanism between the naval forces of both countries, the ongoing negotiations over the East China Sea issue saw the first meeting in Tokyo last month at the director-general's level of both foreign ministries, and a second meeting is expected in September, Satoh noted.
Responding to Chinese expectations of more participation by Japanese companies in the construction of the Caofeidian eco industrial park, Japan will set up a study group to facilitate the investment of Japanese firms there, Satoh added.