China's economic shift hailed abroad as tonic

Focus on quality growth will lift other nations, IMF, World Bank chiefs say

China's strenuous efforts to secure high-quality growth will help not only the country but also the world to recover from the pandemic's effects, and its domestic rebalancing will drive green development, leaders of two international economic organizations said.

Kristalina Georgieva, managing director of the International Monetary Fund, or IMF, said on Monday that the global economy is recovering but that it faces many risks, including the uncertain path of the COVID-19 pandemic amid the arrival of new variants, and the outlook on inflation.

"Supporting the global recovery will be a joint task that we need to tackle together," Georgieva said at the conclusion of the Sixth "1+6"Roundtable convened virtually by Chinese Premier Li Keqiang.

The roundtable, "Promoting Strong, Inclusive and Sustainable Growth of the World Economy: From Recovery to Restructuring", offered a forum for leaders of international economic organizations to have in-depth exchanges on promoting the global economic recovery with sustainable growth, and on the steady development of the Chinese economy.

"China is a vital engine for global growth; taking strong actions to support high-quality growth will help not only China but the world," Georgieva said.

In areas for global cooperation, the IMF chief highlighted the urgent need to vaccinate at least 40 percent of the population in each country by the end of this year and 70 percent by mid-2022－proposals set out earlier by the global lender.

She said the IMF acknowledged China's "important contributions "to expanding access to vaccines.

China has provided 1.7 billion doses of COVID-19 vaccines to at least 100 countries and international organizations and will supply more than 2 billion doses by the end of this year, Chinese Ambassador to the US Qin Gang said last month.

The IMF chief called for cooperation to reduce trade tensions and strengthen the multilateral trading system, which she said is a key engine for growth and jobs.

Roadblocks

In its latest World Economic Outlook released in October, the IMF listed the intensification of trade and technology tensions as being among the major risk factors that contribute to the uncertainty in the global recovery.

"An escalation of trade and technology tensions, notably between the United States and China, could weigh on investment and productivity growth, raising additional roadblocks in the recovery path," the 190-member global lender noted.

Georgieva also said that more ambition is needed to accelerate the transition to net-zero carbon emissions and to support climate-adaptation efforts, tapping all policy levers available.

"China's climate strategy is taking shape and will play an important role in global climate efforts," she said.

At the virtual roundtable, World Bank President David Malpass said the number of people in extreme poverty has increased by more than 100 million globally since the beginning of the pandemic, and the low vaccination rate adds to the risks and human suffering.

Malpass said China's active participation and "strong voice" in debt-reduction efforts are very much needed and would benefit all participants by encouraging sustainable investment and debt.

He said China's economy has had a "rapid and very welcome" recovery from the pandemic, but growth has been slowing recently, which reflects structural headwinds that can be addressed.

"The key to China's future growth lies in a rebalancing of domestic demand and increases in private sector innovation and expansion," Malpass said.

He notes that China's structural transformation toward lower carbon intensity, which is an important part of its climate response, is closely aligned with the goal of domestic rebalancing.

"One reason for the high carbon intensity of China's economy is the overweighting of real estate and the associated demand for cement and steel in China's economy," Malpass said. "A more service-oriented, consumption-driven growth model would create more sustainable jobs and generate less pollution and greenhouse gas emissions as well."

China's experience with growth and poverty reduction over the past four decades demonstrates the power of market-oriented reforms, property rights and the ingenuity of China's entrepreneurs.

"These are lessons that China can share with others and (that) are particularly relevant for China's future growth as well," Malpass said.