Nov 18 2014
What China expects for the Brisbane G20 summit
By Ye Yu
China, as one of the core members, greatly values the G20. It hopes the G20 will be able to maintain a stable and open global economic system that is beneficial for its domestic development. It is also willing to share more international responsibilities through the G20. For the Brisbane G20 summit, China expects the following:
Firstly, it expects effective communication with the US and other major powers about managing spillover effects of ongoing monetary policy adjustments. Its own financial sector was able to stay safe in the 2008 crisis, but has accumulated risks from the stimulus. Controlling risks is one of its priorities and the external factors play important roles.

Secondly, it expects the G20’s growth agenda in 2014 can be well implemented. The G20 has shifted its focus to growth after the world economy experienced a “double dip” caused by American and European crises respectively since 2008. The G20’s infrastructure agenda for global growth is also in line with China’s interests and strategies. While the G20 has set a 2 per cent goal for its collective GDP growth speed-up by 2018, China is also trying all efforts, including targeted stimulus, to keep its gross domestic product growth rate this year close to 7.5 per cent for employment. China hopes to share with other G20 members about how to implement the Public-Private Partnership (PPP) in infrastructure projects, and also expects the G20 to support its new initiatives in establishing BRICS New Development Bank and Asia Infrastructure Investment Bank, as part of its strategy of increasing regional connectivity through building the New Silk Road Economic Belt and the 21st Century Maritime Silk Road (“One Belt One Road”).

Thirdly, it expects the G20 to drive key structural reforms of its member states for a more sustainable world economy. The target of halving fiscal deficits by 2013 for advanced economies set at the 2010 G20 Summit in Toronto has not been achieved. Standards and requirements have been raised for financial institutions, while their full implementation is also a problem. China also expects the G20 to be a source of pressure to drive its domestic reform agenda, including liberalising its interest rates and exchange rates while at the same time strengthening regulation, controlling local governments’ debts, reforming state-owned enterprises and levelling the playing field for private sectors.

Key international agendas

Fourthly, it expects the G20 to keep pushing forward key international agendas. Approval of International Monetary Fund reform package of 2010 has been long overdue. Global financial safety net needs to be strengthened through better co-ordination between the IMF, regional financial arrangements, bilateral currency swaps and national reserves. The Bali Agreement needs to be renegotiated immediately to rescue the WTO Doha Round’s only achievement. China expects the G20 to support its new initiative of Asia-Pacific Free Trade Agreement under the APEC. China also hopes the G20 can provide strategic leadership, such as bridging gaps in key debates, for the ongoing UN process in setting a new course for international development co-operation after 2015.

Lastly but not the least, it expects the G20 to be able to foster its comprehensive and strategic dialogues with its key partners, such as the US, EU and BRICS in line with the interests of global economic governance. The most important function of the G20 as an international institution is to manage the spillover effects of major powers, including maximising the positive and minimising the negative. As a member of the G20, China has got more awareness of global responsibilities. We have seen that the G20 has been increasingly integrated into China-US Strategic and Economic Dialogue. The BRICS Summit process was actually a by-product of the G20 as it formed immediately after the G20 Summits became a reality. Therefore, if the G20 provides a platform of peer pressure for major powers to co-operate better and clean their own houses, it will be a great contribution to the G20. This is also the essence of what China expects for the so-called “new type of major power relationship” at different levels.

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