Boao 2016 Recharges Asian Econ­omy

China Today (English) - - CONTENTS - By LIN MINWANG

The 2016 ses­sion of Boao Fo­rum for Asia fo­cused es­pe­cially on eco­nomic re­struc­tur­ing, re­gional eco­nomic in­ter­con­nec­tiv­ity and im­prov­ing sci & tech in­no­va­tion ca­pac­i­ties.

THE 15th Boao Fo­rum for Asia, con­vened in late March, was one of the first ma­jor diplomatic events China hosted this year. Af­ter years of de­vel­op­ment the event has built on its global rep­u­ta­tion and is now more widely ob­served than ever be­fore. The 2016 ses­sion is also deemed a run-up to the G20 Sum­mit to be held in China’s Hangzhou City in Septem­ber.

De­ter­mine Di­rec­tion

China val­ues the Boao Fo­rum as an op­por­tu­nity to ex­press its stand­point and make rec­om­men­da­tions. Chi­nese Pres­i­dent Xi Jin­ping de­liv­ered at the 2015 ses­sion a key­note speech ti­tled “To­wards a Com­mu­nity of Com­mon Des­tiny and A New Fu­ture for Asia,” in which he called on Asian coun­tries to fos­ter a com­mu­nity of shared des­tiny, and elab­o­rated on its guid­ing prin­ci­ples and China’s role in this mis­sion.

The theme of the 2016 fo­rum, Asia’s New Fu­ture: New Dy­nam­ics, New Vi­sion, reprised the key phrase – New Fu­ture – of the pre­vi­ous two ses­sions. In con­tin­u­ing to ex­plore paths to Asia’s fu­ture de­vel­op­ment, the 2016 fo­rum fo­cused specif­i­cally on eco­nomic re­struc­tur­ing, re­gional eco­nomic in­ter­con­nec­tiv­ity and col­lab­o­ra­tion, more in­vest­ment in in­fra­struc­tures, and im­prov­ing sci & tech in­no­va­tion ca­pac­i­ties.

China, the largest econ­omy in Asia and the big­gest trade part­ner of most coun­tries in the re­gion, shapes the fu­ture of the Asian econ­omy. The trend and poli­cies of Chi­nese econ­omy at the “new nor­mal” (lower growth rate, higher qual­ity) stage are there­fore of broad con­cern in Asia and be­yond. Mean­while, the re­gion’s geopo­lit­i­cal sit­u­a­tion be­comes trick­ier, as sev­eral dis­putes within it in­volve China. The Boao Fo­rum of­fers China a much needed chan­nel to speak out and ex­plain it­self to the rest of the con­ti­nent and the world at large.

Fuel the Econ­omy

The 2016 Boao Fo­rum took place at a time when the out­look for Asian, in­clud­ing the Chi­nese, econ­omy, ap­peared un­cer­tain. This lent more weight to the event. China took this op­por­tu­nity to ad­dress the con­cerns of its Asian peers and guide their ex­pec­ta­tions.

The two top eco­nomic is­sues Asia needed to ad­dress were:

First, where is the Chi­nese econ­omy head­ing? The coun­try’s 2015 GDP growth, at 6.9 per­cent, met its “around seven per­cent” tar­get, but was un­de­ni­ably the low­est since 1990. In­evitably there has been anx­i­ety in the in­ter­na­tional com­mu­nity about prospects for the Chi­nese econ­omy, as re­flected in the out­flow of a large quan­tity of for­eign cap­i­tal from the coun­try, steep losses on the Chi­nese stock mar­ket, and fluc­tu­a­tion of the RMB ex­change rate. All this bodes great un­cer­tainty for the Chi­nese econ­omy in the com­ing months, which in turn gen­er­ates pes­simism in the mar­ket.

Cer­tain econ­o­mists are con­vinced that the de­cline of Chi­nese growth is due to its shrink­ing la­bor force and ris­ing la­bor costs as a con­se­quence of an ag­ing pop­u­la­tion. Ge­orge Soros pre­dicted in Davos last Jan­uary that Asian cur­ren­cies would weaken and that 2016 would be a dif­fi­cult year for the mar­ket. The famed fi­nancier’s ex­plicit plac­ing of the blame for this on China ex­ac­er­bated world con­ster­na­tion about the coun­try’s eco­nomic sta­bil­ity and raised the ques­tions: Is China’s real econ­omy in trou­ble? And are China’s pol­i­cy­mak­ers ca­pa­ble of grad­u­ally slow­ing down the coun­try’s eco­nomic growth with­out spark­ing an eco­nomic cri­sis or so­cial un­rest?

The sec­ond is­sue con­cerns the world eco­nomic out-

The 18th ASEAN-China Sum­mit is con­vened in the Kuala Lumpur Con­ven­tion Cen­ter on Novem­ber 21, 2015.

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