Li Keqiang holds “1+6” roundtable dialogue with heads of major international economic and financial institutions, stressing to promote strong, sustainable and balanced growth of the Chinese and global economy.

 

At a roundtable dialogue with heads of major international economic and financial institutions in Beijing on July 22, Chinese Premier Li Keqiang enumerated the challenges facing the global economy and called for a unified international solution.

Present at the meeting were leaders of the six most powerful multilateral global governance organizations, including World Bank Group President Jim Yong Kim, IMF Managing Director Christine Lagarde, WTO Director-General Roberto Azevêdo, ILO Director-General Guy Ryder, OECD Secretary-General Angel Gurría and G20 Financial Stability Board Chairman Mark Carney, who is also Governor of the Bank of England.

Based on the consensus reached at the meeting, four conclusions can be drawn about why it was so successful.
 

First of all, China always respects and supports the work of international organizations. The aforementioned global economic and financial organizations are the most important components of global governance established after the end of World War II, and they play a positive role in promoting world economic development and sustaining financial stability.
 

China has also been responsible for launching some of the newest international organizations, while it serves as the maintainer and contributor of the international order. Participating international financial chiefs recognized China as their major partner in the world trade system and also a principled advocate of globalization and multilateralism.

Moreover, now that China has taken over the rotating G20 presidency, it has and will continue to display its leadership. For many years, China has been open to advice and suggestions from international economic organizations, while it remains a firm believer in the effectiveness of multilateral trade systems.

China’s sense of responsibility as a major country can be seen in its commitment to the professional development of workers and the improvement of public welfare.

Furthermore, international economic organizations have praised the achievements of China’s reform and economic development. While the recovery of the global economy has been slow, China’s economy has maintained a steady rate in the first half of 2016. Amid growth, China’s economic structure has been optimized, and consumption and the service industry have become the major driving force.
 

The IMF raised China’s growth forecast while lowering its estimates for aggregate global economic growth in 2016, showing that it is optimistic about Chinese government’s resolve to carry on with reform and opening up as well as its policy to implement sustainable growth.
The consensus reached at the roundtable can help to boost confidence in global recovery. Proposals were made at the meeting to address the problem of world economic recovery. For example, all sides agree that they must utilize various effective, comprehensive and coordinated policy tools including monetary, fiscal and structural reforms to cope with risks and instability of world economy.
 

Monetary policy should focus on supporting economic activity while maintaining price stability. Fiscal policy should be flexible and aimed at promoting growth, increasing employment and boosting confidence. In addition, to keep sustainable growth, all sides should advance structural reform as well as prevent and mitigate fiscal risks.

Finally, the agreements reached lay the groundwork for the 2016 G20 Hangzhou summit, which is set to take place in September. Heads of the six organizations expressed their expectations for the summit and also made suggestions. They said structural reform should be high on the summit’s agenda. They also support China in its role as the current holder of the G20 presidency and its commitment to achieving the 2030 Agenda for sustainable development. Proposals were made for aid packages to realize inclusive growth by funding the industrialization of least-developed countries in Africa, Latin America and other parts of the Global South.

Li called the roundtable a groundbreaking dialogue. Initiated by the Chinese government, the meeting brings together major international economic and financial organizations at a critical point in global economic development. It symbolizes China’s willingness to strengthen communication with the international community, he said.

 

The article was translated from People’s Daily. Shi Jianxun is director of the Institute of Finance and Economics at Tongji University in Shanghai.