Source: Xinhua Published: 2016-5-29
As the 100-day countdown started Friday for the Group of 20 (G20) summit in Hangzhou, East China`s Zhejiang Province, expectations are running high that members of the bloc, representing the bulk of global trade and economic output, will make concerted efforts to address the various challenges facing the global economy.
China is, for the first time in the history of the G20, putting development at the center of the global macroeconomic policy framework to address the prolonged slowdown in world economic growth.
The theme of the G20 summit this year is to build an innovative, invigorated, interconnected and inclusive world economy.
China, the chair of the G20 meetings this year, puts innovation high on the agenda of the G20 summit, along with topics such as boosting trade and investment, improving global economic and financial governance, cross-border tax cooperation, and anti-corruption cooperation.
"I congratulate China for shifting the focus of G20 from looking at how to repair the scar of crisis to now, looking more forward at how do we get strong and resilient growth," said Andrew Wychkoff, director for science and technology of the Organization for Economic Cooperation and Development (OECD).
In his opinion, growth based on innovation and technology is "exactly strong growth," which Wychkoff said increases productivity, improves social welfare, and in many cases is environmentally friendly.
The world economy desperately needs growth, though economists may differ over what causes global economic growth to slow down.
The International Monetary Fund (IMF) in April cut its global economic growth forecast for 2016 by 0.2 percentage points to 3.2 percent, in its fourth downward revision within a year.
"As I see it, the major reason for the global trade slowdown is that the globalization process has been losing speed since the onset of the 2008 global financial crisis," said Song Hong, senior fellow at the Institute of World Economics and Politics, a unit of the Chinese Academy of Social Sciences.
Governments have focused more on issues such as job creation and less on trade and outward investment, and businesses have shifted their focus to local markets as they are less motivated to go global, said Song.
Problems burdening the global economy also include turbulence in the financial markets and the commodities market, divergence in monetary policies and worsening geopolitical conflicts, among others.
Actions and goals agreed among the G20 leaders are non-binding, which adds to lingering doubts over its effectiveness. Despite this, the general opinion is that it has quickly grown to be an indispensable part of global economic governance.
Liu Zongyi, a researcher with the Shanghai Institutes for International Studies, said the G20, which has played a key role in policy coordination to deal with the 2008 international financial crisis, would again offer valuable policy reference in case of a fresh crisis.
"It is the only platform where leaders of developed nations and their counterparts from emerging economies can engage in a dialogue as equals," he said.
The G20 also provides essential momentum for the reform of the global governance structure so that it better reflects the shifting balance in both the political and economic arenas.
With intensive efforts underway to further optimize its economic structure, China will be in a better position to achieve sustainable and inclusive growth.
China has been a key contributor of global economic growth in recent years. It has put together the right policy mix to lift hundreds of millions out of poverty and has been a strong advocate of cooperation.
Jim O`Neill, formerly chief economist with Goldman Sachs, Baron of Gatley and now a minister in the British government, told Xinhua that he expected China to nurture the growth of emerging economies during its G20 presidency.
China had had "remarkable success," notwithstanding some of its considerable challenges, in raising the welfare and wealth of its 1.3 billion people.
"I think it can help others, especially in the emerging world, of moving down a similar path and contributing to a stable and more prosperous world economy," said O`Neill.
Liu Zongyi, a visiting fellow of the Chongyang Institute for Financial Studies, Renmin University of China, was quoted in this article.