How does China view its current economic slowdown? What are the future prospects of China's economy? Will China adopt any new measures to stabilize economic growth?
The fundamentals of the Chinese economy are sound. In the first half of this year, China's GDP grew by 7.6%, which was relatively high compared with other countries. In fact, the growth rate could have been higher had we continued with the past development model. However, we have chosen to implement a macro economic policy under which we will press ahead with the adjustment of economic structure in order to transform and upgrade the economy. We would rather bring down the growth rate to a certain extent in order to solve the fundamental problems hindering our economic development in the long run. In this sense, such a growth rate is the result of sound adjustment.
In specific terms, domestic demand accounted for 7.5 percentage points in the 7.6% growth rate, and our current account surplus is now within the internationally recognized reasonable range. We have focused on improving our social security policy and stabilized and expanded employment, providing 7.25 million new jobs in the first half of this year. We are indeed confronted with difficulties such as local government debt and overcapacity in some industries, but the problems are well within control and could be handled properly.
China's economy, the second largest in the world, is highly integrated with the world economy. China's economic development has contributed significantly to world economic recovery. A China that enjoys more stable economic performance, higher quality of growth and better prospect of sustainable growth undoubtedly bodes well for the world economy. We have the conditions to realize sustained and sound economic development, which will expand market and development space for other countries and generate more positive spillover effect for the global economy.
The Eighth G20 Leaders' Summit will soon be held in St Petersburg, Russia. What does China expect from the summit?
The G20 Leaders' Summit will soon take place in St Petersburg. At a time when world economic growth lacks momentum and the deep-seated impact of the international financial crisis goes on unabated, it will be an important meeting among leaders of the world's major economies. China supports the St Petersburg summit to focus on growth and employment to promote even closer partnerships among G20 members, strengthen their macro-economic policy coordination and jointly usher in a brighter future for the world economy.
First, G20 members should adopt responsible macro-economic policies. It is important that each country should, first and foremost, manage its own affairs well, keep its own economic house in order, and enhance economic competitiveness through vigorous structural reforms. On the basis of this, parties should step up policy coordination, make sure that the spillover effect of their policies are positive, not otherwise, and work together to meet the major risks and challenges in the international economic and financial fields.
Second, the G20 should uphold and promote greater openness in the world economy. Countries should categorically oppose protectionism of all forms, promote an early harvest of the Doha Round negotiations, and safeguard a free, open and non-discriminatory multilateral trading regime. Efforts should be made to deepen economic integration among countries, build a global value chain, and avoid fragmentation of markets and trading systems. This will contribute to win-win development of all countries.
Third, the G20 should work to improve global economic governance. It should continue to increase the representation and voice of emerging markets and developing countries. In particular, it should speedily implement the quota and governance reform plans for the IMF, complete on time IMF's quota formula adjustment and the next round of general quotas review by January 2014, and review the basket of currencies for special drawing rights as scheduled for 2015.
Fourth, the G20 should strive to be a development partner for developing countries. It should fully harness its own advantage and demonstrate greater political commitment to pushing for solutions to global development issues. It should forge more effective global partnerships on development, and mobilize more economic resources to tackle a greater number of development challenges.
What has made it possible for the G20 Leaders' Summit to play an important role in tackling the international financial crisis? How is the G20 different from other mechanisms for international economic cooperation? What is China's view on G20's role in the present-day world?
The G20 consists of both developed countries and emerging economies. It operates on consensus and reflects the changing world economic landscape as well as shifts in international economic relations.
After the outbreak of the international financial crisis in 2008, the G20 was defined as the premier forum for international economic cooperation. As such, it has encouraged greater international coordination on macro-economic policies. It has taken a number of major steps, and gradually lifted the world economy out of the shadow of the financial crisis. In addition, it has promoted quota reform at the IMF and voting rights reform at the World Bank, established the more representative Financial Stability Board, and supported the WTO in playing a central role in the multilateral trading regime. By doing so, it has made important contribution to the improvement of global economic governance.
Right now, the G20 is in a transition from a crisis-management mechanism to one that is dedicated to long-term economic governance. If its members continue to follow the spirit of solidarity and win-win partnership, and take firm steps to strengthen macro-economic policy coordination, improve global economic governance, reform the international financial system, and promote global trade liberalization, the G20 will definitely embrace a bright future.