PresidentXiJinpingattendsonNovember15,2015,the10thG20SummitinAntalya.THE2016G20SummitwillbeheldintheChinesecityofHangzhouunderthethemeof“Buildinganinnovative,invigorated,interconnectedandinclusiveworldeconomy”andwiththegoalsoftransforminggrowthpatternsininnovativeways,improvingglobaleconomicandfinancialgovernance,promotingglobaltradeandinvestment,andnurturinginclusiveandinterconnecteddevelopment.
China’shostingoftheG20Summithasattractedworldattentionfortworeasons:First,theG20standsatacriticaljunctureintransformingfromacrisis-responsemechanismtoalong-termeconomicgovernancemechanism.Second,againstthebackdropoftheglobaleconomicdownswing,peoplehopethatChinaandotherG20participantswilldevisenewideasandplanstofostersustainabledevelopmentoftheworldeconomy.
TheworldplaceshighhopesonChinabecausetheworldhasencounteredbottlenecksinpromotingeconomicgrowthandreformingglobaleconomicgovernance,andalsobecauseChinahasachievedspectacularresultsoverthepastfewyears.AtatimewhenChinaisassumingtheG20rotatingpresidency,countriesaroundtheworldareponderingthequestionofwhatChinacandoforglobaleconomicgrowth.ThisalsoposesaseverechallengeforaChinawhichhasenteredits“newnormal”stage.
Asthemostauthoritativeplatformforleaderstoliaisewithoneanotherandcoordinatethefinancialsector,thisyear’sG20Summitwillseeksolutionstosluggishglobaleconomicgrowth.
Whatthenisamisswiththeworldeconomy?ChinesePresidentXiJinpingsharedhisviewsonthisquestionatthe2015G20AntalyaSummitasfollows:First,althoughtheworldeconomynolongerteetersincrisis,theeconomicrecoverybaseisweaknonetheless,whileimpetusforgrowthremainselusive.Second,progressinreformingglobaleconomicgovernancehasbeenuneven,andthusinternationaleconomicandtraderulesaremiredamidprofoundchanges.Third,asthemainbodyforworldeconomiccoordination,theG20isconfrontedwithgreatdifficultiesinmanagingmacroeconomicpolicies.
ThesepercipientassessmentsbytheChineseleaderregardingthecurrentworldeconomyarelikewisethemainconsiderationspromptingthisyear’sG20Summittofocusonthethemeof“Buildinganinnovative,invigorated,interconnectedandinclusiveworldeconomy.”
Innovativeeconomicdevelopmentconceptsareofutmostimportance.AnancientChineseaxiominformsthat“Nothingcanbeaccomplishedwithoutstrongdetermination.”Theeconomicdevelopmentconceptsof“innovation,vitality,interconnectionandinclusiveness”conformtoChina’snewdevelopmentconceptsof“innovation,coordination,greendevelopment,opening-upandsharing”proposedduringtheFifthPlenumofthe18thCPCCentralCommittee,allofwhichserveasindicatorsthatChinastandsintheforefrontinformulatingglobaleconomicdevelopmentconcepts.
Chinahascontributedmorethan30percenttoglobaleconomicgrowthoverthepastseveralyears,therebyentrenchingthecountryastheenginedrivingglobalgrowth.G20membersandothereconomiesaroundtheworldexpectthatChina,throughtheG20SummitinHangzhouandothermeetings,toplayaleadingpartinunitingotherG20memberstoformulatenewsolutionstofacilitateglobaleconomicgrowthandstrengthenmacroeconomicpolicycoordinationinabidtoresolvethedeep-levelconflictscurrentlyconfoundingtheglobaleconomy.
EnhancingCommunicationandCoordination
Countriesaroundtheworldtodaymustadjusttheireconomicstructurestotackletheproblemofeconomicimbalances.Globalizationandglobalvaluechainshavebondednationsintoacommunityofsharedfutureandcommoninterests.Restructuringandpromotinggrowtharenolongerisolatedbehaviorsofasinglecountry.
ItiscriticalfortheG20toplayaleadingroleinbolsteringcoordinationofmacroeconomicpolicyamongthemajoreconomies.First,effortsmustgotowardsestablishingaministerial-levelmechanismformacroeconomicpolicycoordinationandjoint-actionand,especially,toenhancecommunicationandcoordinationoffinancial,fiscal,monetaryandtradepolicies.TobetterensuretheimplementationofdecisionsbyG20leaders,thedelegationofcertainpowersofcoordinationandsupervisiontotheconsultationmechanismofG20financeministersandcentralbankgovernorsshouldbetakenintoconsideration.TheG20membersmustfurtheradoptaholisticviewoftheworldeconomy,rendertheirmacroeconomicandfinancialpoliciesmoretransparent,andfullyconsidertheimpactoftheirpoliciesonothereconomiestoavertadverse“spillovereffects.”Forexample,whentheFederalReserveraisesinterestratesandadjuststheU.S.dollarexchangerateagainstothercurrencies,theFedcannotifyG20membersandworldfinancialcentersinadvanceviacoordinationwiththeFinancialStabilityBoard(FSB),aninternationalbodycreatedbytheG20.
Second,effortsshouldalsobemadetohelpdevelopingcountriesenhancetheircapacitytodealwithsuchfinancialandeconomicrisksasthosebroughtbyfluctuationsinbulkcommoditypricesandsuddenoutflowsofliquiditystemmingfromastrongerdollar,sotoforestallasevereimpactuponandconsequentdamagetotheirnationaleconomies.DevelopingcountriesnowaccountforhalfofglobalGDPandcontributeover50percenttoworldeconomicgrowth,yetremainsubordinateindecision-makingorwhenexpressingtheiropinionswithintheglobalfinancialandeconomicsystem.
Thefluctuationsofinternationalcapitalmarketsandbulkcommoditypricesingeneralcanengenderhugerisksthatmedium-sizedandsmallcountriesfinddifficulttocopewithontheirown.TheG20Summitisexpectedtofocusonhowtohelpdevelopingcountriesenhancetheircapabilitytoavertandresistrisks.From2009tothepresent,theU.S.hasimplementedquantitativeeasing(QE),apolicythathaspumpedUS$6trillionintoitsfinancialsystem.TheEuropeanCentralBankandtheBankofJapanbothcontinuetoimplementpoliciesfeaturingexcessivemoneysupply.Currently,whentheU.S.economyhasgraduallystabilized,theFederalReserveislikelytoraiseinterestrates,amovethatinalllikelihoodwillleadtoaperiodicallystrongdollar.Thefinancialriskposedtherebymaysubstantiallyharmemergingeconomiesanddevelopingcountries.Asthe“guidingcommittee”oftheglobaleconomy,theG20isexpectedtohelpdevelopingcountriesbuilda“firewall”tocopewithfinancialandeconomicrisks.AstherotatingpresidentoftheG20,Chinawillprioritizethisissueontheagenda.
ForeignMinisterWangYibriefsChineseandforeignjournalistsonMay26,2016onproceedingsattheG20HangzhouSummit.SpurImpetustoEconomicGrowththroughInnovation
Newimpetustogalvanizetheworldeconomyshouldderivefromtechnologicalinnovations,butattentionmustalsorestonpreventingthedevelopmentofautomationandartificialintelligence(AI)andtheuseofrobotsfromimpactingtheemploymentofthosedoingrepetitivework.Chinainparticularmuststressthisissuewhendesigningtheagendaforthisyear’sG20Summit.
RelianceoninnovationintechnologyandproductionmodelsisneededinChina’sindustrialrestructuringandupgrading.Effortsmustnotonlytargetstimulationofoveralldemand,butalsoimprovementofaggregatesupplybydevelopingnewtechnologies,products,energysources,andbusinessmodels,thebettertoattractconsumersandexplorenewmarkets.Themarketmustalsobegivenfreereintoplyitsfunctionofdeterminingresourceallocation.Atthesametime,thegovernmentsofvariouscountriesmustactivelyexerciseeffectivemacroeconomicregulationandcontrol,asthecoordinationofthe“invisiblehand”ofthemarketand“visiblehand”ofthegovernmentwillreciprocallyameliorateoneanother’sworkings.
AretrospectiveoftheworldeconomicdevelopmentandChina’sreformandopening-upofover30yearsdemonstratesthatinnovationisaninexhaustiblesourceofdynamismforsustainableeconomicgrowth.Themotiveforceofeconomicgrowthmustcomefrominnovation,andfromanewroundoftechnologicalandindustrialrevolution.XiJinpinghasstressedthatweareinthemidstofanewindustrialandinformatizationrevolutionandthataccordinglywemustclearlycomprehendthecurrentsituationandachievegrowththroughinnovation,newtechnologies,newtypesofbusiness,andnewmodelsofproductionandbusiness,aviewthatalsoholdstrueforworldeconomicgrowth.
Innovation’stwomajorgoalsaretoreformtheeconomicsystemandmechanismandtosparktechnologicalandindustrialrevolutions.ItpresentsaneffectivemeansfortheChineseeconomytomaintainmedium-tohigh-speedgrowthunderthecurrent“newnormal”stagebypromotinginnovationasapropellant,exploringnewdynamismforgrowth,andpersistinginthereformoftheeconomicsystemandmechanism,apaththatmayalsoproveeffectiveinliftinggrowthforotherG20members.
RepresentativesofindustrialandcommercialconcernswithintheG20memberstatesharborthedeepestunderstandingofeconomicdevelopmentandgrowth.TheywillparticipateintheG20activitiesthroughtheBusiness20(B20)Summit.OthereventsaffiliatedwiththeG20SummitincludetheYouth20(Y20),whichbringstogetheryoungleadersfromacrossG20countries,andThink20(T20),comprisingthinktanks,academicsandresearchersrepresentingG20Summitcountries.Theseparticipantswilloffertheiradviceandsuggestionsforpromotingworldeconomicgrowth.Chinamustplaninadvanceinordertopresentpragmaticplanstothesummit.
Forexample,businessrepresentativesandyouthleaderscandiscusshowtoevadethepitfallsassociatedwithcapitalandunemployment.ItisaxiomaticthatsomeAsianandLatinAmericancountriesfellintothemiddleincometrapafterbecomingmiddle-incomecountriesasaconsequenceofimproperpolicies.Consequently,whentheirindustrializationattainedacriticalmass,theyhadn’tyetresolvedproblemsrelatingtocapitalandunemployment.First,nationalsavingsmainlytransformedintolaborandresourceproductsforexport,andthecapitalneededforindustrialupgradeswasthusabsent.Secondwasthedifficultyexperiencedbylow-endlaboringainingreemploymentinthecourseofindustrialization.Indeed,China’sexperienceinthisregardiswellworthsharingwithotherG20members.
DevelopingcountriessuchasChina,India,Brazil,Indonesia,andTurkeycanlearnanddrawexperiencefromeachotheronsimilarissues.Chinaisnotaresource-exportingcountry,anditsindustrializationlevelisunevenindifferentregions.Itsmedium-tolow-endlaborcanbeabsorbedinternallybydevelopingserviceandmanufacturingindustries.However,thesituationmaybequitedifferentincountriesreliantonresourceexports.
ProvidingNewIdeasforAchievingBalancedDevelopmentoftheGlobalEconomy
Chinaisgearingupforthesummit,itsfocusontransforminggrowthpatternsininnovativeways,improvingglobaleconomicandfinancialgovernance,promotinginternationaltradeandinvestment,andfurtheringinclusiveandinterconnecteddevelopment.ItmaythusmanifestitswillingnesstoenhanceexchangesandshareexperienceineconomicandfinancialgovernancewithotherG20members.ItshopeisthattheG20mayleadworldeconomicgrowthinthespiritofwin-wincooperation.
Chinahascontributedtofuelingglobaleconomicgrowthduringthemostdifficulttimefortheworldeconomy.In2015,theChineseeconomyroseby6.9percent.Althoughgrowthwasslowing,China’seconomicstructurehadbeenoptimized,withtheproportionoftertiaryindustryhitting50.5percent,10percenthigherthanthatofsecondaryindustry.End-userconsumptioncontributedasmuchas66.4percenttototalGDPgrowth.Effortssuchasstreamliningadministrationanddelegatingpowertolowerstrata,aswellasloweringtaxesandslashingvariousadministrativefeeshavefurtherstimulatedenthusiasmformassentrepreneurshipandinnovation.InChina,anaverage12,000newbusinessesregistereachday,53percentofthemengaginginnewtypesofbusinessandadoptingnewbusinessmodels.
Asalargeresponsiblecountry,Chinawantstoprovidenewideasandnewdynamismtoboostthebalanceddevelopmentoftheglobaleconomy,withtheBeltandRoadInitiativeasanimportanttrialinthisregard.Practicalmeasuresadoptedinclude:1.EstablishmentoftheAsianInfrastructureInvestmentBank(AIIB),itsaimtocontributeitssharetoconstructinginfrastructureincountriesalongtheBeltandRoadusingChina’sdevelopmentexperienceandaccumulatedtechnologyandcapital,andsoboostingregionalandcross-regionaleconomicdevelopment;2.Advocatingnewmodelsforbilateralandmultilateralcooperationwhileelevatinginternationalcooperativecapacity.Forexample,effortscanbemadetoencouragegovernmentandprivatecapitaltoinvestintheconstructionofindustrialparksasanincidenttocooperationwithcountriesalongtheBeltandRoad.ThoseeffortsdemonstrateChina’sresolvetoshoulderitsresponsibilitytoparticipateinglobalgovernance.
China’sFive-YearPlans,aseriesofeconomicgrowthinitiatives,havelastedthelongestofanycountryintheworld,havingbeenimplementedforatotalof60years.Asof2016,Chinastartedtoinstituteits13thFive-YearPlan,whichcoversareassuchasagriculture,industry,serviceindustry,urbanization,resourcesandenvironment,technologyandeducation,publicservice,socialmanagement,culture,economicreform,andopeninguptotheoutsideworld.TheG20meetingsencompassasummitofleaders,meetingsofcoordinators,ministerialandvice-ministerialmeetings,andmeetingsofexpertsandprofessionalworkinggroups.Thesewillallserveasplatformsforcooperationandsetthefoundationfortheimplementationofa“globaleconomiccoordinationsystem.”China’sexperiencestandsasanexemplarworthyofreferenceindevisingtheG20“globaleconomiccoordinationsystem.”The2016G20meetingsmaybecomeanimportantoccasionforChinatoshareitsdevelopmentexperience.WethereforehopethatChina’sachievementsandexperiencewillcontributetostimulatingglobaleconomicgrowth.
HEYAFEIisformerdeputyforeignministerandformerdeputydirectoroftheOverseasChineseAffairsOfficeoftheStateCouncil.