World Bank chief says China holds key to global recovery
Source: Xinhua/Shanghai Daily |
September 6, 2011, Tuesday
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Print Edition
Print Edition
CHINA can boost global economic growth by pressing ahead with reforms to promote domestic consumption and reduce reliance on exports and investment, World Bank President Robert Zoellick said yesterday.
"The world economy won't get out of this hole by simply relying on austerity policies," he told reporters in Beijing.
Zoellick's comments came amid mounting fears the United States might be headed back into recession after reports that the economy added no jobs in August, its worst employment report in 11 months.
China's spending on new factories and other investment has accounted for more than 40 percent of its economic output over the past decade - several times the level of the US, Japan and other major economies. It rose close to 50 percent in 2009 due to stimulus spending, according to the International Monetary Fund.
China and the World Bank are jointly researching ways to help rebalance the world's second largest economy and move toward a path of sustainable growth under the current challenging global economic situation, Zoellick said.
A report, being prepared by the World Bank, China's Ministry of Finance and the Development Research Center of the State Council will be released later this year to support China in identifying the many challenges and policy choices it will face in the next two decades, Zoellick said.
Regarding this autumn as "a sensitive time facing the world's major economies," Zoellick said many countries, including the US, the European Union and Japan, were facing the similar fundamental challenge of restructuring for sustainable economic growth.
"Perhaps the challenge is more difficult for China as the country has already made remarkable progress, and thus it's not easy to persuade people to make a change," he said.
Commenting in Beijing on a weekend workshop with senior Chinese officials and outside experts, Zoellick said there was agreement that China will have to rebalance its economy, improve the environment, reduce inequality and advance the quality of life for its people while at the same time maintaining rapid growth.
"In the near term, inflation is China's priority, as Premier Wen Jiabao mentioned," Zoellick said, adding that the Chinese government was moving in the right direction, though it was too early to have the problem solved.
In next 10 years, however, Zoellick said he could not imagine China continuing to rely on exports for growth, especially when developed economies have had difficulties recovering.
By shifting from an over-dependence on export-led growth to a greater reliance on domestic demand and investment, China could benefit not only itself but the world economy, he said.
As China's 12th Five-Year Plan has pointed the way forward with what needs to be done, Zoellick said the ongoing research will try to help with the "how."
He said the report will cover issues such as how China can complete its transition to a market economy; how to promote open innovation; how to advance green development; how to deliver equality of opportunity and social security to citizens; how to strengthen the fiscal system, and how China can become a responsible stakeholder in the international system.
During his stay in China, Zoellick visited the country's wasteland-turned grain-producing center in the northeast, including a farm, a rice mill, an agricultural research center and a modern agricultural machinery park, and learned about how this transformation had affected people's lives in the region.
With the world population expected to hit 9 billion by 2050, Zoellick said the World Bank has been urging G20 countries to prioritize food issues.
"China feeds 20 percent of the world's population with less than 10 percent of the world's agricultural land and less than 6 percent of its water, so China could make a significant contribution to global food security," Zoellick said.
"The world economy won't get out of this hole by simply relying on austerity policies," he told reporters in Beijing.
Zoellick's comments came amid mounting fears the United States might be headed back into recession after reports that the economy added no jobs in August, its worst employment report in 11 months.
China's spending on new factories and other investment has accounted for more than 40 percent of its economic output over the past decade - several times the level of the US, Japan and other major economies. It rose close to 50 percent in 2009 due to stimulus spending, according to the International Monetary Fund.
China and the World Bank are jointly researching ways to help rebalance the world's second largest economy and move toward a path of sustainable growth under the current challenging global economic situation, Zoellick said.
A report, being prepared by the World Bank, China's Ministry of Finance and the Development Research Center of the State Council will be released later this year to support China in identifying the many challenges and policy choices it will face in the next two decades, Zoellick said.
Regarding this autumn as "a sensitive time facing the world's major economies," Zoellick said many countries, including the US, the European Union and Japan, were facing the similar fundamental challenge of restructuring for sustainable economic growth.
"Perhaps the challenge is more difficult for China as the country has already made remarkable progress, and thus it's not easy to persuade people to make a change," he said.
Commenting in Beijing on a weekend workshop with senior Chinese officials and outside experts, Zoellick said there was agreement that China will have to rebalance its economy, improve the environment, reduce inequality and advance the quality of life for its people while at the same time maintaining rapid growth.
"In the near term, inflation is China's priority, as Premier Wen Jiabao mentioned," Zoellick said, adding that the Chinese government was moving in the right direction, though it was too early to have the problem solved.
In next 10 years, however, Zoellick said he could not imagine China continuing to rely on exports for growth, especially when developed economies have had difficulties recovering.
By shifting from an over-dependence on export-led growth to a greater reliance on domestic demand and investment, China could benefit not only itself but the world economy, he said.
As China's 12th Five-Year Plan has pointed the way forward with what needs to be done, Zoellick said the ongoing research will try to help with the "how."
He said the report will cover issues such as how China can complete its transition to a market economy; how to promote open innovation; how to advance green development; how to deliver equality of opportunity and social security to citizens; how to strengthen the fiscal system, and how China can become a responsible stakeholder in the international system.
During his stay in China, Zoellick visited the country's wasteland-turned grain-producing center in the northeast, including a farm, a rice mill, an agricultural research center and a modern agricultural machinery park, and learned about how this transformation had affected people's lives in the region.
With the world population expected to hit 9 billion by 2050, Zoellick said the World Bank has been urging G20 countries to prioritize food issues.
"China feeds 20 percent of the world's population with less than 10 percent of the world's agricultural land and less than 6 percent of its water, so China could make a significant contribution to global food security," Zoellick said.
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