Speech

Boao Forum for Asia Annual Conference 2022

April 20, 2022

Zao shang hao . Thank you for inviting me to this year’s Boao Forum.

The theme for this year’s Forum, “The World in COVID-19 and Beyond: Working Together for Global Development and A Shared Future,” could not be more timely.

Today, the global economic community—and policymakers everywhere—face immense challenges.

The global economy has been hit by shock after shock, resulting in crisis upon a crisis.

First, the pandemic: for two years, it turned our lives and economies upside down, and it is still not over. The continued spread of the virus could give rise to even worse variants, prompting further disruption and divergence between and within countries.

Second, the war in Ukraine: this is a human tragedy and devastating for Ukraine’s economy, and it is sending shockwaves throughout the globe.

As a result of these crises, we now project a further downgrade in global growth for 2022 and 2023.

While prospects vary across countries, we can see the impact in all regions. Higher energy and food prices add to inflationary pressures, squeezing the real incomes of households almost everywhere.

Yet, the worry is not just the slowdown but the added risks and uncertainty we face—well beyond the normal range.

• An escalation of the war would further weaken the global recovery and fragment the world into geopolitical blocs—with different trade and technology standards, payment systems, and reserve currencies.
• Tighter financial conditions would further complicate the recovery, especially for vulnerable countries where debt is already elevated.
• A more prolonged slowdown in China would have substantial global spillovers.

· Meanwhile, climate risks are getting worse.

The upshot is that this is the most universally complex policy environment of our lifetime, requiring decisive actions by the global community.

• First: end the war in Ukraine.

• Second: continue to confront the pandemic, with a comprehensive toolkit that includes vaccines, testing, and anti-viral treatments—deployed everywhere.

• Third: tackle inflation and debt . Central banks should act decisively and communicate clearly. Spending must be carefully prioritized and targeted. Some countries will require debt restructuring. To help them, the G-20 Common Framework must be improved.

As the world’s second largest economy, actions to counter the growth slowdown here in China, and achieve the authorities’ ambitious growth target, are also vital for the global recovery. Fortunately, China has policy space to provide macroeconomic policy support , including shifting the focus toward vulnerable households to strengthen consumption, which can also help support China’s climate goals by steering economic activity to lower-carbon sectors. Stronger policy efforts in the property sector can also help secure a balanced recovery.

But the solutions for the global economy go beyond any one country. Countering the far‑reaching damage of these back-to-back crises, and the risks we face in a more shock prone world, requires stronger international cooperation. This is paramount.

We must preserve and improve the rules-based framework that has governed international and economic relations for more than 75 years and has helped deliver significant improvements in living standards across the globe. All countries have a vital role in supporting multilateral efforts.

Let us all work for a stronger, more resilient, and sustainable world. We can do it, but only if we work together.

Xie xie!