SEOUL -- Visiting Chinese President Hu Jintao said Tuesday that China and South Korea should strengthen coordination¹ and cooperation to jointly² cope with challenges.

Addressing a luncheon³ with South Korea's four major economic groups, Hu said trade and economic cooperation is an important element of Sino-South Korean relations, and has played a significant role in developing bilateral⁴ ties.

The bilateral trade volume reached nearly $160 billion last year, a 32-fold increase compared with early days when the two countries established diplomatic ties, he said.

Hu added that so far, the two-way investment has exceeded US$41 billion, an almost 90-fold increase.

China and South Korea, as neighbors which are similar in culture and mutually complementary in economy, have natural and cultural advantages in in developing trade and economic cooperation, he said.

"Meanwhile, we should also realize that, amid a complicated, volatile⁶ international economic situation, Sino-South Korean trade and economic cooperation is confronted with many challenges," said the Chinese president.

"Under this situation, China and South Korea should strengthen coordination and cooperation and make full use of this opportunity to properly resolve challenges," Hu said.

Hu put forward a three-point proposal on boosting economic cooperation between the two countries.

China and South Korea should facilitate their cooperation in some key areas, the Chinese president said.

Complementarity is one of the biggest advantages in the two countries' trade and economic cooperation, he said, adding that China has a huge market and rapid growth in its economy, while South Korea has rich experience in technical industrialization and business management.

The two countries should further exploit their advantages and enhance exchanges and cooperation in key fields such as telecommunications, finance, energy, logistics and environmental protection, so as to raise the quality and level of bilateral cooperation, Hu said.

China and South Korea should also boost mutual⁵ investment, he said.

Hu urged the two countries to adapt themselves to changes in their investment environments, expand investment areas and improve investment modes.

The Chinese government welcomes investment from more South Korean enterprises, and encourages and supports more Chinese enterprises to invest in South Korea, he said.

Finally, Hu said, China and South Korea should broaden cooperation in international economic affairs.

With the further development of economic globalization, the two countries have witnessed an increase in their coordination and cooperation in regional and international economic affairs, he said.

He called on Chinese and South Korean enterprises to strengthen consultation⁷ and broaden cooperation in working out international criteria⁸, expanding international markets and participating in regional integration⁹.

The Chinese government is willing to work with its South Korean counterpart to facilitate cooperation between the two countries' enterprises, Hu said.

"I believe that the continuous development of China-South Korea strategic cooperative partnership¹⁰ will open up a broad sphere for the two countries' entrepreneurs to give full play to their wisdom and creativeness and realize mutually-beneficial and win-win outcomes," he said.

The Chinese president is paying a two-day visit to South Korea as the first leg of his six-day Asia tour, which will also take him to Tajikistan and Turkmenistan.

He will also attend the annual summit of the Shanghai Cooperation Organization slated¹¹ for August 28 in Dushanbe, Tajikistan's capital.