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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China and the global economic crisis
Foreign Office Minister Lord Malloch Brown spoke to Anthony Yuen of Phoenix TV about the financial crisis and the 2 April London Summit when he was here for talks. He is travelling to raise the level of ambition for the London Summit. He made some key points:
First, this is now a full blown global economic crisis. Better regulation and better warning systems are not enough. We need to co-ordinate a plan for global growth.
Second, the team has changed. There are new people in the front row, and no better example than China, now the world's third largest economy.
Third, the G20 must send a clear signal against protectionism. Free trade is centrally important to globalisation, that has brought huge prosperity, not least to China. We now live in one global market. We must keep it that way. Protectionism would also have political consequences.
Fourth, we needed to stimulate our economies. The Chinese leadership is putting more money into infrastructure, education and healthcare. We welcome this. But in London, all countries would be asking whether we have done enough. We may need to do more.
Fifth, in response to a question about rising expections of China - China is a great power. A lot is riding on all our leaders. Leaders needed to reverse a pervasive sense of insecurity, or huddle and hide. The London Summit would be a crossroads - between fragmentation, nationalism and suspicion, or an optimistic vision, underpinned by a more inclusive power arrangement. Success would have big coat tails.
Sixth, we must maintain our commitments to help the poorest.
Seventh, we need to make the recovery a green one.
This is one of many conversations that we will be having in the run up to the London Summit. There is also a public debate, hosted on the London Summit website. Please take part - at www.londonsummit.gov.uk
Posted at 13:42 25 February 2009 by Peter Wilson | Comments[0]
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UK/China Summit, London 2 February
Premier Wen Jiabao visited the UK from 31 January to 2 February, for the annual summit between China and the UK, which was held in London this year. He had a private dinner with Prime Minister Gordon Brown on Saturday, and he and his high powered delegation had formal talks and a lunch with the Prime Minister and several members of the British cabinet on Monday. Foreign Secretary David Miliband also held talks with Foreign MInister Yang Jiechi on Sunday afternoon. The two leaders also attended a breakfast seminar with economic and financial thinkers, and a meeting with British business leaders.
These talks were important, and reached agreement on some big issues - details of the press conference, and agreements reached, are on www.number10.gov.uk . Premier Wen's schedule was packed. He gave an in depth interview to the Financial Times (the transcript is at www.ft.com/wen ), and speeches to the China Britain Business Council, and to Cambridge University (full text at http://news.xinhuanet.com/english/2009-02/03/content_10753336.htmand ). He saw some of the Chinese companies who have invested successfully in the UK, and toured China Town as part of Chinese New Year.
The joint declaration http://news.xinhuanet.com/english/2009-02/03/content_10753162.htm agreed between the two sides highlighted the importance of tackling the economic crisis together, and provided an important building block in preparation for the G20 London Summit, scheduled for April 12. More at http://www.londonsummit.gov.uk/en/ .
Posted at 09:02 03 February 2009 by Peter Wilson | Comments[0]
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Chinese New Year is a time for people to return to their families. This is probably the largest annual movement of people in the world, with almost 200 million travelling home, mostly by train. This year, some of the migrant workers returning home will not be coming back, as there are fewer jobs for them now. China's economy is still growing fast. But the global slowdown has taken a toll here, and last quarter's growth, annualises at 6.8%, is the slowest for seven years.
We stayed in Beijing. Premier Wen is already in Europe. He has been at Davos, and is coming to the UK soon. So there has been a lot of work to do, for us and for the Chinese Ministry of Foreign Affairs. But there's also been a bit of time for skating on the frozen lakes behind the Forbidden City, and seeing family and old friends. This year is the Year of the Ox. A sturdy, reliable animal - qualities that we and China will need in 2009.
This year, the Foreign Secretary recorded a New Year's message, with Sir Alex Fergusson, manager of Manchester United Football Club. You can see it on the Embassy's website.
Thanks for all the comments on the strategy, and Fiona's (YL Ting's) Happy New Year. Happy New Year to you too!
Posted at 06:06 30 January 2009 by Peter Wilson | Comments[3]
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