Building an open global economy more important than ever
By Xie Fuzhan |
chinawatch.cn |
Updated: 2019-07-15 15:46
Through the international division of labor and a global market, economic globalization has allowed countries to embrace vital economic, production and development opportunities around the world. Globalization has also promoted the flow of goods and capital, furthered the progress of science and technology and boosted cultural exchanges, injecting strong impetus into prosperity and stability of the world.
The economic globalization is mainly driven by complementing demands of all countries; and has promoted world economy to be more open, inclusive, balanced and mutual beneficial, which can meet the needs of promoting global prosperity and ensuring fundamental interests of people across the globe.
Since economic globalization is irreversible, international communities need to adapt to the trend, proactively cope with contradictions and problems emerged during the globalization and make it better to benefit all nations and people.
Opening-up can bring progress while exclusiveness undoubtedly leads to backwardness.
This view stems from China’s experience drawn from its 40 years of reform and opening-up, and echoes with various economics theories and practices of development of many countries.
China has benefited from the globalization and is a positive contributor to the open global economy. Since its reform and opening-up in 1978, the average growth rate of China’s economy has reached 9.5 percent and its contribution to the global economy has risen from 1.8 percent to 15.8 percent.
The country’s total imports and exports of goods have increased from merely $20.6 billion to $4.62 trillion over the 40 years, with its utilization of foreign direct investment exceeding $2.1 trillion and outbound foreign investment totaling $2 trillion.
Since the global financial crisis of 2008, China has taken opening-up as a fundamental approach to coping with the crisis and opened its door even wider, which has allowed more countries to share the opportunities brought about by its development.
Over the past years, China has contributed over 30 percent to global economic growth, playing a key role in stabilizing and driving the global economy.
The global economy is undergoing profound changes and economic globalization is developing amid obstacles. Meanwhile, reforms of the global governance system and the international order are accelerating.
Against such background, the United States, as the world’s largest economy, has carried out a string of beggar-thy-neighbor measures, largely undermining the multilateralism and free trade systems and exposing the open global economy to unprecedentedly severe challenges.
According to the Global Trade Alert, the US has added more than 1,770 new protectionist measures since November 2008, ranking it first in the world on this count. In 2018 alone, the country introduced 217 new protectionist measures, up 36.5 percent compared with the previous year.
For its own benefit, the US which once advocated “free trade” has turned against open global cooperation, which has not only led to the rapid deterioration of the global economic and trade environment in recent years but also setbacks in the current Sino-US trade talks.
In contrast, China has launched a new round of opening-up in recent years focusing on institutional and structural opening. For example, in April 2018, President Xi Jinping announced four major measures at the opening ceremony of the Boao Forum for Asia to widen China’s opening-up including widening market access, creating a more favorable investment environment, improving intellectual property rights protection and expanding imports. Separately, at the first China International Import Expo in November the same year, Xi reaffirmed the resolution of opening up.
Deepening reform and opening-up will inject impetus to China’s high-quality development, and also bring more opportunities to other countries. In the next 15 years, China is expected to import $24 trillion of goods, absorb $2 trillion of foreign direct investment, and invest $2 trillion in overseas market.
The rise of protectionism and unilateralism in the US and foreign-trade frictions it has frequently triggered have severely undermined the stable and sound development of international trade and the global economy.
According to the World Trade Organization, the growth rate of dollar-denominated goods exports of the world’s major economies such as the European Union, Japan, China and the US in the first quarter of this year fell sharply from the corresponding period of the previous year, in which that of the four economies dropped 23.7 percentage points, 16 percentage points, 12.3 percentage points and 6.5 percentage points, respectively.
In April this year, the WTO lowered the 2019 growth rate of international trade by 1.1 percentage points from the forecast figure in September last year to 2.6 percent.
Further, the International Monetary Fund lowered the global economic growth rate this year to 3.3 percent, a record low since 2010.
Therefore, in short, building an open global economy is more important and urgent than ever.
The author is president of the Chinese Academy of Social Sciences.
This article is an edited excerpt from his keynote speech at the the International Forum for Open Global Economy held in Osaka, Japan on June 25.
All rights reserved. Copying or sharing of any content for other than personal use is prohibited without prior written permission.
Through the international division of labor and a global market, economic globalization has allowed countries to embrace vital economic, production and development opportunities around the world. Globalization has also promoted the flow of goods and capital, furthered the progress of science and technology and boosted cultural exchanges, injecting strong impetus into prosperity and stability of the world.
The economic globalization is mainly driven by complementing demands of all countries; and has promoted world economy to be more open, inclusive, balanced and mutual beneficial, which can meet the needs of promoting global prosperity and ensuring fundamental interests of people across the globe.
Since economic globalization is irreversible, international communities need to adapt to the trend, proactively cope with contradictions and problems emerged during the globalization and make it better to benefit all nations and people.
Opening-up can bring progress while exclusiveness undoubtedly leads to backwardness.
This view stems from China’s experience drawn from its 40 years of reform and opening-up, and echoes with various economics theories and practices of development of many countries.
China has benefited from the globalization and is a positive contributor to the open global economy. Since its reform and opening-up in 1978, the average growth rate of China’s economy has reached 9.5 percent and its contribution to the global economy has risen from 1.8 percent to 15.8 percent.
The country’s total imports and exports of goods have increased from merely $20.6 billion to $4.62 trillion over the 40 years, with its utilization of foreign direct investment exceeding $2.1 trillion and outbound foreign investment totaling $2 trillion.
Since the global financial crisis of 2008, China has taken opening-up as a fundamental approach to coping with the crisis and opened its door even wider, which has allowed more countries to share the opportunities brought about by its development.
Over the past years, China has contributed over 30 percent to global economic growth, playing a key role in stabilizing and driving the global economy.
The global economy is undergoing profound changes and economic globalization is developing amid obstacles. Meanwhile, reforms of the global governance system and the international order are accelerating.
Against such background, the United States, as the world’s largest economy, has carried out a string of beggar-thy-neighbor measures, largely undermining the multilateralism and free trade systems and exposing the open global economy to unprecedentedly severe challenges.
According to the Global Trade Alert, the US has added more than 1,770 new protectionist measures since November 2008, ranking it first in the world on this count. In 2018 alone, the country introduced 217 new protectionist measures, up 36.5 percent compared with the previous year.
For its own benefit, the US which once advocated “free trade” has turned against open global cooperation, which has not only led to the rapid deterioration of the global economic and trade environment in recent years but also setbacks in the current Sino-US trade talks.
In contrast, China has launched a new round of opening-up in recent years focusing on institutional and structural opening. For example, in April 2018, President Xi Jinping announced four major measures at the opening ceremony of the Boao Forum for Asia to widen China’s opening-up including widening market access, creating a more favorable investment environment, improving intellectual property rights protection and expanding imports. Separately, at the first China International Import Expo in November the same year, Xi reaffirmed the resolution of opening up.
Deepening reform and opening-up will inject impetus to China’s high-quality development, and also bring more opportunities to other countries. In the next 15 years, China is expected to import $24 trillion of goods, absorb $2 trillion of foreign direct investment, and invest $2 trillion in overseas market.
The rise of protectionism and unilateralism in the US and foreign-trade frictions it has frequently triggered have severely undermined the stable and sound development of international trade and the global economy.
According to the World Trade Organization, the growth rate of dollar-denominated goods exports of the world’s major economies such as the European Union, Japan, China and the US in the first quarter of this year fell sharply from the corresponding period of the previous year, in which that of the four economies dropped 23.7 percentage points, 16 percentage points, 12.3 percentage points and 6.5 percentage points, respectively.
In April this year, the WTO lowered the 2019 growth rate of international trade by 1.1 percentage points from the forecast figure in September last year to 2.6 percent.
Further, the International Monetary Fund lowered the global economic growth rate this year to 3.3 percent, a record low since 2010.
Therefore, in short, building an open global economy is more important and urgent than ever.
The author is president of the Chinese Academy of Social Sciences.
This article is an edited excerpt from his keynote speech at the the International Forum for Open Global Economy held in Osaka, Japan on June 25.
All rights reserved. Copying or sharing of any content for other than personal use is prohibited without prior written permission.
