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Li Keqiang Discusses Measures to Meet Global Economic Challenges with Heads of Major International Economic and Financial Institutions

On the morning of July 22, 2016, Premier Li Keqiang held the “1+6” round table dialogue at the Fanghua Garden of Diaoyutai State Guesthouse with President Jim Yong Kim of the World Bank, Managing Director Christine Lagarde of the International Monetary Fund, Director-General Roberto Azevedo of the World Trade Organization, Director-General Guy Ryder of the International Labor Organization, Secretary-General Angel Gurria of the Organization for Economic Cooperation and Development as well as Chairman Mark Carney of the Financial Stability Board. Centering around the theme of “global economic situation and challenges” during the first session, all sides carried out in-depth exchanges mainly on topics such as global economic policies, implementation of the 2030 Agenda for Sustainable Development, reviving global trade, promoting structural reform, labor market policy, as well as international financial regulatory reform.

Li Keqiang said that at present, the world economy is undergoing a sluggish recovery and global trade remains in the doldrums. The trend of “de-globalization”, represented by protectionism and isolationism is emerging. Geopolitical risks are increasing, and the UK’s exit from the EU and other challenges have brought new complicated changes. This dialogue is not only an important meeting held at a crucial moment of global economic development, but also a pioneering collective dialogue between the Chinese government and major international economic and financial institutions, indicating China’s willingness to strengthen communication with the international community. It is hoped that all parties can accurately grasp the trend of world development, find good ways to promote world economic growth, and jointly push forward economic recovery, stabilize finance as well as guide expectations. Li Keqiang put forward five proposals:

First, strengthen macro-economic policy coordination. Under current circumstances, all parties should put promoting strong, sustainable and balanced growth, developing economy and improving people’s livelihood in a prioritized position in policy formulation, strengthen coordination, and focus on jointly promoting global economic recovery.

Second, strike a balance between addressing periodical factors and deep-seated structural conflicts as well as between short-term problems and medium-to-long-term problems. We should moderately expand aggregate demand, put structural reform in a prominent position, and implement fiscal and monetary policies that are conducive to domestic demand expansion and structure adjustment. We should give play to consumption and the service sector in stimulating the economy, develop new economy, and form new economic growth engines.

Third, advance global trade and investment liberalization and facilitation. In the face of sluggish global economy and weak demand, trade-restrictive measures cannot solve problems and are unhealthy to structural reforms. It will only aggravate the situation and slow down the global economic recovery process. We should firmly support economic globalization, take a clear-cut stand against all forms of protectionism, and maintain the main channel status of the multilateral trade system.

Fourth, promote inclusive growth. We should relax regulation, promote competition, support innovation, advance reforms in fiscal, financial and labor markets, improve infrastructure, and create more jobs with higher quality. Implementation of the 2030 Agenda for Sustainable Development and promotion of inclusive growth should be set as the development direction and an important driving force of world economic recovery.

Fifth, give better play to the supporting role of finance to economic recovery. We should not only strengthen macro-prudential management, improve reasonable supervision on cross-border capital flows, and prevent systemic financial risks, but also strengthen coordination and stabilize expectations in the financial sector so as to create a favorable environment for economic recovery.

Present heads of major international economic and financial institutions appreciated the positive role of China’s economic growth in promoting global economic recovery, and expressed that given the uncertainties and various growing risks and challenges faced by the current global economy, all parties should strengthen coordination of macro-economic policies, enhance infrastructure construction, increase input in human resources, promote the development of multilateral trade, improve the international financial system and support the development of innovative, low carbon and inclusive economy, so as to jointly send a positive signal of promoting growth through cooperation.

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