Category: Aggregated

An article in People’s Daily underlines the fact that the world is waiting for China to take the lead in reforming economic governance. The article by Guo Jiping was given an “abstract translation” in the Chinese edition of the paper Thursday.

In the article, Guo says that “eight years have passed since the onset of the global financial crisis, but downward pressure lingers in today’s world economy.” The G20, he writes, has an advantage as a platform in dealing with this crisis. “The world is counting on China at this critical stage of the ongoing global economic governance transformation,” Guo says.  He then goes through the four “I’s” announced by President Xi Jinping as the theme of this year’s summit: “Towards an Innovative, Invigorated, Interconnected, and Inclusive World Economy.”

With regard to innovation, Guo writes: “The world economy can only be revived by innovative technology, pro-development philosophy, new mechanisms, and fresh business modes.”“Invigoration can release development potential,” he continues. “The G20 members should stimulate economic vitality by intensifying global cooperation and accelerating domestic structural reforms, so that they can push for a more equal-footed, reasonable, and highly-efficient form of global economic governance; optimize their endogenous impetus, and thus fully release the potential of world economy.”

“Interconnection” means that “only by synergizing each country’s development with global economic growth, can resources around the world be allocated in the most optimal way.” “Inclusiveness” refers to “the responsibility of the international community to benefit people in every corner of the world with the dividends of global economic growth.”“With innovation as a priority, the Hangzhou summit will work out a G20 Blueprint on Innovative Growth and formulate action plans on innovation, the new industrial revolution and digital economy,” Guo writes. “The summit will also decide on the prioritized areas, guidelines and index system of the structural reform; deepen international financial architecture reform, and optimize the global financial security network, in order to promote the re-balancing of the world economy.”

Guo then concludes by underlining the important paradigm- shift which the summit hopes to accomplish: “Facing rising geopolitical and security challenges, the G20 Hangzhou summit will focus on international economic cooperation and lay the foundation for world stability. By inviting the most developing countries ever to attend the meeting, the meeting also aims to narrow the development gap and call for an inclusive world economy.” 

Speaking a day before the inauguration of the Eastern Economic Forum at Vladivostok, New Development Bank (NDB, also known as the BRICS Bank) Vice President Zhu Xian said: “We established good relations with the AIIB. Also we have already started discussion of possible forms of cooperation. Firstly, we plan to co-finance some projects. Secondly, we have already signed the relevant agreement on cooperation. At the moment, many investment projects are in need of financing. That’s why we should not compete, but complement each other,” Tass reported Thursday.

Both the AIIB and NDB are headquartered in China, and were set up to partner-finance projects that would fill in the huge infrastructure gap that has paralyzed development in Eurasia,  if not around the world. Nominally speaking, the NDB focuses on the five BRICS countries while the AIIB focuses on Asian countries. Tass also reported Zhu saying, “I think we complement each other; also a lot of investment projects lack finance….  We want to be the financial institution of the 21st century, but not to be a copy of the traditional financial institution,” he added, referring to the IMF and World Bank.

While the joint financing projects have not been finalized yet, Zhu Xian said the NDB “experts are studying the possibility of funding road construction projects in Russia.””A number of Russian projects attracted our attention, especially in the transport sector,” Zhu added, according to Tass. In addition, Zhu told Sputnik today:”We have plans in other national bond markets, including Russia. We are already in discussions with the Russian government on the possibilities of issuing ruble-based bonds in Russia as well.”