Duncan Sparkes, our Economics Counsellor, has just been in Shanghai, to talk at the China Europe International Business School about the forthcoming London Summit. He kindly agreed to do a guest spot on my blog. Duncan writes...
We are now in the final run-up to the London Summit on 2 April. China’s leadership has been engaging impressively with us, and it clearly wants the Summit to be a success. Three UK ministers have visited Beijing since the start of the year, and they have been received at the highest levels.
Earlier this week, we took part in an event on the London Summit at the China Europe International Business School in Shanghai, whose programmes the Financial Times ranks in the global Top 25. After explaining our ambitions for what we want the London Summit to achieve, I offered some suggestions how China itself could contribute to ending the economic crisis and paving the way for a durable recovery.
First, as Premier Wen Jiabao himself has stated, China’s main contribution to the world economy is to manage its own economy well. So we welcome the economic stimulus measures announced in recent months, and China’s determination to achieve 8% growth this year.
Secondly, I argued that China should continue to resist taking any protectionist trade and currency responses to the crisis. As one of the world’s leading exporters, China understands that international trade and globalisation bring great benefits, which we must not allow the crisis to reverse.
Thirdly, I suggested that the crisis had underlined the need for China to re-balance its economy, away from exports and investment and towards domestic consumption. An economy more reliant on consumption would generate more jobs, use less resources, and make it easier to achieve President Hu Jintao’s goal of a harmonious society.
Finally, I hoped that China would engage actively in the reform of the international financial institutions, to equip them to play a more effective role, with a reformed mandate and representative governance arrangements.
The ensuing panel discussion and debate with the academic staff and students was lively and provocative. Many speakers argued that the crisis had been caused by excessive borrowing and extravagant consumption by western economies, coupled with inadequate financial sector regulation. The budget and current account deficits of the United States attracted particular criticism, given the dollar’s role as the main international reserve currency. But I was reassured that, despite the crisis, most speakers recognised that globalisation had benefited China and spoke out against protectionism. And they argued that financial sector deregulation and innovation, if properly supervised, were good for the economy and should continue in China.
Read more about the outreach event at: http://www.ceibs.edu/media/archive/37784.shtml
Duncan Sparkes
Posted at 01:29 18 March 2009 by Peter Wilson | Comments[0]
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