By James Pomfret
LONGBRIDGE, England (Reuters) - China plans to stimulate domestic demand and reduce its foreign trade surplus to encourage balanced trade growth, premier Wen Jiabao said on Sunday during the British leg of a visit to Europe.
He made the comments during a tour of the Chinese-owned Longbridge MG Motor factory in Birmingham, central England, where he unveiled the first new MG Motor model in 15 years.
He also repeated his assurance that China would remain a long-term investor in European sovereign debt, saying China would lend to those countries experiencing difficulty borrowing.
"China has no intention to pursue a trade surplus," he told BBC television through a translator.
"What we want is to have balanced and sustainable growth of trade. At home we are going to further stimulate domestic demand and we are going to reduce our foreign trade surplus and our reliance on exports," he said.
"First, we'll welcome more British products into Chinese markets and we will create conditions to make it happen. Second, we are going to make more use of this co-operation model, that is: the design by the British team, the manufacturing by the Chinese workers and assembly by the British workers."
Diplomats say China and Britain are expected to announce more than one billion pound's worth of deals in a range of industries during Wen's three-day visit.
Wen will meet British Prime Minister David Cameron on Monday
in the latest of a series of bilateral summits focused largely on trade and business, which will also likely encompass the eurozone debt crisis and human rights.
China's leading automaker SAIC Motor Corp Ltd became the owner of MG Rover's Longbridge plant after a merger in late 2007 with its smaller rival, Nanjing Automobile Group.
Several dozen human rights protesters demonstrated with banners and loudspeakers outside Longbridge's factory gates, including yellow-shirted supporters of Tibetan independence and the Falun Gong spiritual movement that is banned in China.
"Cameron and Wen -- Human rights before trade," they said.
China has clamped down heavily on dissent this year, arresting scores of activists to smother scattered online calls for an Arab-style "Jasmine revolution," though it has shown some sign of a climbdown, releasing prominent artist and activist Ai Weiwei last week and prominent dissident Hu Jia Sunday.
During his visit to Hungary Saturday, Wen said he was willing to buy a "certain amount" of Hungarian government bonds.
When asked if he planned to lend to others, Wen said: "We have done this for Hungary and we will do the same thing for other European countries."
Cameron took the largest ever British delegation to China last November, with relations between the two countries expanding in areas of trade, education, science and tourism.
Earlier in the morning, Wen paid a visit to Stratford-upon-Avon, near Birmingham, the birthplace of William Shakespeare, whom the Chinese leader is said to admire.
(Additional reporting by Avril Ormsby; Editing by Peter Graff)