budget; 46. Underlines the global importance of the South China Sea, through which one third of the world’s trade passes; is alarmed at the escalating tension and therefore urgently appeals to all the parties involved to refrain from unilateral political and military actions, to tone down statements and to settle their conflicting territorial claims in the South China Sea by means of international arbitration in accordance with international law, in particular the UN Convention on the Law of the Sea, in order to ensure regional stability; 47. Is seriously worried about the escalating tensions between China and Japan; appeals strongly to China and Japan to combat perceptions of one another as mutual enemies, and considers regrettable their failure to use the 40th anniversary of their diplomatic relations for constructive negotiations; 48. Calls, in view of the European Union’s significant interests in the security and stability of East Asia, on all parties concerned (China, Japan and Taiwan) to demonstrate restraint and to take steps to calm the situation on the disputed islands; urges all parties concerned to settle disputes peacefully in a spirit of cooperation and in compliance with international law, in particular the UN Convention on the Law of the Sea, and agree on de-escalating measures of engagement in the event of unforeseen incidents; 49. Takes note of Taiwan’s initiative with a view to reaching a consensus on a code of conduct for the East China Sea and the establishment of a mechanism allowing all sides to cooperate in the joint exploitation of the region’s natural resources, including capacity for the generation of electricity from renewable sources; 50. Notes that China’s role in the cooperation between the two parties on the Korean Peninsula is vital and calls on the PRC more actively to seek enhanced cooperation between the North and the South; 51. Notes, and considers it regrettable, that the survival of the dictatorial and repressive North Korean regime depends essentially on China; welcomes China’s responsible behaviour in voting in favour of the UNSC’s strong condemnation on 15 April 2012 of the failed rocket launch by North Korea, widely considered as an attempted ballistic missile test; looks forward to China continuing to take responsibility for stability on the Korean Peninsula, a swift resumption of the six-party talks on the North Korean nuclear threat, and, above all, a drastic improvement in the day-to-day living conditions of North Korean citizens brought about through Chinese incentives; 52. Notes China’s growing role in the Central Asian region through trade, economic and energy projects; considers that China can play a major role in the development of countries in Central Asia and calls on the PRC to promote better relations between states there as a pivotal step towards regional cooperation; remarks that China’s main objectives within the Shanghai Cooperation Organisation are to achieve peace and stability in Central Asia by collectively combating the so-called ‘three evils’ of extremism, separatism and terrorism; notes China’s great strategic and economic interest in the region through the exploitation of its vast oil and gas reserves and the connection of Central Asia to China’s coastline via railways and highways; 53. Welcomes the developing ties between China and Afghanistan, with talks taking place at a senior leadership level for the first time in history; considers that China can play a pivotal