TL;DR – All aboard the China train heading into a bright future?
The Word Economic Forum (WEF) is an annual gathering of the world’s who’s who that happens in Davos, Switzerland. To get to attend is already a big deal. To have the opportunity to give a speech there is an even bigger deal. For the first time ever, Xi Jinping, the President of China, delivered a speech at the WEF.
In that speech, President Xi made these five key points:
Globalisation got good, got bad
Because of globalisation, people today generally lead better lives than people in the past. But, the world has gotten more uncertain in recent years. There are more frequent regional conflicts. Terrorism and refugees are also some of the challenges the world faces. There is still widespread poverty, with increasing unemployment and widening income gap adding to the world’s problems. Yea, all problems arising from the Fourth Industrial Revolution.
But, while it is true that economic globalization has created new problems, President Xi said that we shouldn’t just write off globalisation completely. Rather, “we should adapt to and guide economic globalization, cushion its negative impact, and deliver its benefits to all countries and all nations”.
The first step is to understand the root causes of the biggest problems of the world’s economies.
What are causing the biggest problems of the world’s economy?
According to President Xi, the world’s biggest problems are mainly caused by three things.
First, the traditional engines of growth of the world aren’t working as well. But, even though there are new technologies, new sources of growth that can replace the traditional engines of growth haven’t really emerged.
Second, the rules and governance of the global economy aren’t up to the task of adapting to the new developments of the global economy.
Third and last, the world economy has developed very unevenly, resulting in many people to be left behind, even as some get wealthier.
Understanding the root causes would make us realise that globalisation is not the problem and allow us to come up with strategies to address those problems.
What needs to be done?
President Xi suggested four approaches.
First, the world’s growth needs to be dynamic and driven by innovation. This sort of growth should meet the challenges of climate change and aging population, address the negative impact of IT application and automation on jobs, and create new jobs and restore confidence and hope to our peoples.
Second, all countries need to work together in an open and coordinated manner to achieve outcomes where everyone wins. As President Xi said, “All countries enjoy the right to development. At the same time, they should view their own interests in a broader context and refrain from pursuing them at the expense of others.” Specifically, we must say no to protectionism, and remain committed to developing global free trade and investment.
Third, the world needs fair and equitable global governance. In President Xi’s own words:
“Countries, big or small, strong or weak, rich or poor, are all equal members of the international community… We should adhere to multilateralism to uphold the authority and efficacy of multilateral institutions. We should honor promises and abide by rules. One should not select or bend rules as he sees fit.”
Last, the world’s development needs to be inclusive and equitable. Specifically, “priority should be given to addressing poverty, unemployment, the widening income gap and the concerns of the disadvantaged to promote social equity and justice. It is important to protect the environment while pursuing economic and social progress so as to achieve harmony between man and nature and between man and society.”
These are difficult tasks. Who better to lead us than China?
Because China is now a superpower.
China can lead the effort because it’s now very zai
China is the world’s second largest economy. Since the financial crisis, China contributed to over 30 percent of global growth every year on average.
More than that, China has “taken major steps to alleviate poverty and lifted over 700 million people out of poverty, and good progress is being made in our efforts to finish building a society of initial prosperity in all respects”. They have introduced more than 1,200 reform measures over the past four years, injecting powerful impetus into China’s development.
Given how big China is, the whole world is naturally concerned with what’s happening in China. President Xi knows this. And he’s quick to tell the world that China will continue to grow. He outlined some of the strategies China has to continue to grow.
In case people get worried about China’s rise, President Xi reassured the world that a prosperous and developed China is good for the world
And that’s good for the world
President Xi reminded the world that from 1950 to 2016, “China provided more than 400 billion yuan of foreign assistance, undertook over 5,000 foreign assistance projects, including nearly 3,000 complete projects, and held over 11,000 training workshops in China for over 260,000 personnel from other developing countries… and made over $1.2 trillion of direct outbound investment, making huge contribution to global economic development.”
As President Xi said:
“China’s development is an opportunity for the world… Rapid growth in China has been a sustained, powerful engine for global economic stability and expansion… China’s remarkable achievement in poverty reduction has contributed to more inclusive global growth. And China’s continuous progress in reform and opening-up has lent much momentum to an open world economy… We will open our arms to the people of other countries and welcome them aboard the express train of China’s development.”
President Xi ended his speech exhorting the world to remain confident, work together, rise to the challenge, take action, and march toward a bright future.
You can watch his speech in full here.