Build an Innovative, Invigorated, Interconnected, and Inclusive World Economy*
September 4, 2016
I declare the G20 Hangzhou Summit open.
I am pleased to meet you all here in Hangzhou. First of all, I want to extend a warm welcome to you.
Last year's G20 Antalya Summit was a great success, and I want to take this opportunity to thank Turkey, which chaired last year's summit, again for its outstanding job and for achieving positive results. Turkey made "strong, sustainable and balanced growth through collective action" the theme of the summit, and promoted results in terms of "inclusiveness, implementation and investment". China has always positively commented on the various tasks carried out by Turkey during its presidency.
Last November, when I introduced Hangzhou to you in Antalya, I quoted a Chinese saying which goes, "Up in Heaven there is Paradise, down on Earth there are Suzhou and Hangzhou." I believe that the Hangzhou Summit will present you an opportunity to appreciate a unique mixture of the past and present Hangzhou. Today, this invitation has become a reality. Here we have both old and new friends, as we gather in Hangzhou to discuss major development plans for the world economy.
In the coming two days, we will discuss topics including enhancement of macro-policy coordination, innovation in growth models, more efficient global economic and financial governance, robust international trade and investment, inclusive and interconnected development and other prominent issues that may impact the world economy.
Eight years ago, at the most critical point of the global financial crisis, the world economy was sliding towards a precipice. The G20 was entrusted to pull it back onto a track of stability in a spirit of partnership and joint action. That was an unprecedented move. Unity triumphed over differences. Mutual benefit replaced selfish gains. That crisis made people remember the G20, and led to the establishment of the G20 as the major forum for international economic cooperation.
Eight years later, the world economy has again arrived at a critical moment. Scientific and technological progress, population growth, economic globalization, and other main engines that propelled world economic growth over the past several decades have shifted down a gear, and their impetus for the world economy has visibly weakened. The growth impetus brought about by the previous round of scientific and technological progress has gradually slackened, and a new round of scientific and technological and industrial revolution has yet to gain momentum. A graying society and low population growth rate in major economies have brought about economic and social pressure on various countries. Economic globalization has suffered a setback. Protectionism and inward-looking tendencies have reasserted themselves. The multilateral trade system has been adversely impacted. In spite of the marked progress in financial oversight reform, risks have continued to accumulate including high leverage and large bubbles. How to make financial markets effectively serve the real economy while maintaining stability still remains a major headache for many countries.
Given the composite effects of these factors, although the world economy has generally maintained a recovery posture, it is still faced with multiple risks and challenges, including a lack of growth impetus, sluggish demand, recurrent volatility in financial markets, and a sustained slump in international trade and investment.
Although the G20 is a forum for the world's major economies with pivotal influences and roles, it also puts itself at the forefront of risks and challenges, and of expanding growth space. The world community has high expectations of the G20 and places great hopes on the current summit. We need to square up to problems and jointly seek answers through respective actions and collective efforts. It is hoped that based on its past achievements, the G20 Hangzhou Summit will offer a prescription that can treat both the symptoms and root causes of the problems and work out comprehensive measures to get the world economy onto a path of robust, sustainable, balanced and inclusive growth.
First, in the face of the current challenges, we should enhance macro-economic policy coordination, join forces to promote global economic growth, and help maintain financial stability. G20 members should adopt sounder and more balanced macro-economic policies in light of their own countries' reality, use various effective policy tools, make overall plans for working out fiscal, monetary and structural reform policies, strive to expand global overall demand, improve the quality of supply in all respects, and solidify the foundation of economic growth. While formulating and implementing the Hangzhou Action Plan, we should continue to enhance policy coordination, reduce negative spillover effects, jointly help maintain financial stability, and raise market confidence.
Second, in the face of the current challenges, we should innovate new development models and tap growth impetus. The G20 should adjust its policy thinking, and place equal emphasis on short-term policies and medium- and long-term policies, as well as on demand-side management and supply-side reform. This year we have reached a consensus on the G20 Blueprint on Innovative Growth, and have unanimously decided to open up a new path and expand new frontiers for the world economy through innovation, structural reforms, new industrial revolution, and digital economy. We need to firmly continue in this direction, help lift the world economy out of the situation of lackluster recovery and fragile growth, and lay a solid foundation for a new round of growth and prosperity.
Third, in the face of the current challenges, we should improve global economic governance and solidify its mechanism guarantee. The G20 needs to steadily improve the international monetary system, optimize the governance structure of international financial institutions, and give full play to the role of SDR of the International Monetary Fund. The Global Financial Safety Net needs to be improved, and cooperation in financial oversight, international taxation, and anticorruption needs to be enhanced so as to increase the capability of the world economy to resist risks. This year we have reactivated the G20 international financial framework working group. We will continue to promote it, and raise its effectiveness.
Fourth, in the face of the current challenges, we need to build an open world economy, and continue to push trade and investment liberalization and facilitation. Protectionism is like treating an ailment with poison. From a short-term perspective, protectionism may seem to relieve a country's internal pressure, but from a long-term perspective, it will inflict irreparable damage on the country itself and on the world economy as a whole. The G20 should not adopt beggarthy-neighbor policies. Instead, it should advocate and promote an open world economy, avoid adopting new protectionism measures, strengthen coordination and cooperation in investment policies, and take effective actions to promote trade growth. We should give full play to the radiating effect and locomotive roles of infrastructure construction and connectivity, help developing countries and small and medium-sized companies to become part of the global value chain, and push for further opening, exchanges, and integration of the global economy.
Fifth, in the face of the current challenges, we should implement the 2030 Agenda for Sustainable Development, and promote inclusive development. Realizing common development is the hope of the people of all countries, particularly the developing countries. According to available statistics, the world's Gini coefficient is already around 0.7, a figure that is higher than the recognized "danger point" of 0.6. This is something we should pay close attention to. This year we have placed development in a prominent position on the G20 agenda, made a joint commitment to earnest implementation of the 2030 Agenda for Sustainable Development, and formulated action plans. At the same time, we will reduce unequal and imbalanced global development, and enable people of all countries to enjoy the growth results of the world economy by means of supporting the industrialization efforts of Africa and LDCs, enhancing energy access, energy efficiency, the utilization of clean energy and recyclable energy, developing inclusive finance, and encouraging young people to start businesses.
The G20 bears the expectations of various countries. It has important missions. We need to make an effort to build up the G20 and steer the world economy in a sound direction of prosperity and stability.
First, advancing with the times and giving full play to its leading role, the G20 should adjust its own development direction in light of the needs of the world economy and further transform itself from a crisis-management body to a long-term and effective governance mechanism. In the face of major and salient problems, the G20 has the responsibility to play a leadership role, demonstrate a strategic vision, chart a course, and identify a development path for the world economy.
Second, words should be matched with action. We need to adopt pragmatic actions. It is better to enforce one thing than making thousands of commitments. We should make the G20 an action team instead of a talking shop. This year we have formulated action plans in the spheres of sustainable development, green finance, improved energy efficiency, and anti-corruption, and we should implement every action in real earnest.
Third, the G20 should create a platform for cooperation in the spirit of making joint efforts for the benefit of all involved. We should continue to enhance the mechanism building of the G20, to ensure that cooperation will be extended and expanded. It is necessary to extensively seek suggestions, and listen attentively to the voices of countries all around the world, particularly those of the developing countries, so that the G20 will be even more inclusive in its work and it will respond to the appeals of the people of all countries more effectively.
Fourth, the partnership spirit. The partnership spirit is the most precious asset of the G20. Although we may differ in national conditions and development stages, and we may face different challenges, we share the same desire for promoting economic growth, the same intention of addressing crises and challenges, and the same vision for realizing common development. As long as we carry forward the partnership spirit of going through thick and thin together, we will be able to ride through the rough waves of the world economy and embark on a brand-new voyage for future growth.
In the course of preparing for the Hangzhou Summit, China has put into practice the concept of openness, transparency and inclusiveness, and maintained close contact and coordination with all other G20 members. We have also held various forms of parallel dialogue. We have briefed the UN, African Union, Group of 77, LDCs, landlocked countries and small island nations, and given information on our preparations for the Hangzhou Summit to countries all over the world and people who have interest in the G20, and listened attentively to their calls and appeals. Their opinions and suggestions have played an important part in the preparations for this summit.
I expect that in the discussions in the next two days we will pool our wisdom and efforts to make sure that the Hangzhou Summit will realize the objectives of promoting world economic growth, enhancing international economic cooperation, and pushing G20 development.
Let us make the Hangzhou Summit a new starting point, lead the convoy of the world economy on a voyage from the Qiantang River here, and head into the vast ocean.
Thank you all.
* Opening speech at the G20 Hangzhou Summit.
(Not to be republished for any commercial or other purposes.)