G20 offers hopes for global growth

Leaders of major economies are set to unleash new impetus for global economic growth through structural reform and improving resilience at the upcoming G20 summit in Brisbane, Australia over the weekend, although security issues and diplomatic rows shadow the economic agenda. [Special coverage]

Chinese President Xi Jinping arrived in Brisbane Friday for the summit, and has state visits to Australia, New Zealand and Fiji on his schedule, hoping to boost China's role in driving the global economy and spurring cooperation in dealing with worldwide challenges including climate change and the spread of epidemics.

The global economy has yet to find the momentum to fully recover from the financial crisis in 2008 despite signs of recovery in the US. A slowdown in growth in China and a sluggish EU add to the challenges in achieving a sustainable growth rate and ample employment.

In February, an ambitious global growth target of at least 2 percent above the currently projected level in 2018 was proposed by G20 finance ministers and central bank governors.

G20 leaders are expected to deliver an action plan at the summit to help achieve the goal, according to the summit agenda.

Challenges in achieving the target, including avoiding financial risks and clearing trade barriers, would be at the center of discussion in the summit, Chen Fengying, a research fellow with the China Institutes of Contemporary International Relations, told the Global Times on Friday.

Strengthening connectivity, in terms of hardware, telecommunication and people-to-people exchange and infrastructure construction, which were major topics at the just-concluded Asia-Pacific Economic Cooperation (APEC) summit in Beijing, would be extended in Brisbane as they are currently core issues for the global economy, Chen said.

Regional economic integration and strengthened cooperation, which were also key APEC topics, will be on the table in the G20 summit, Xu Hongcai, director of the Department of Information under the China Center for International Economic Exchanges, a Beijing-based think tank, told the Global Times on Friday.

Major economies have been introducing diverging policies, with the US withdrew from quantitative easing but the EU and Japan are pushing ahead a loose monetary policy, said Xu.

Leaders of major economies should better coordinate to avoid causing financial fluctuation affecting emerging economies, said Xu.

With its increasing influence in global affairs, China should and will play an important role in every topic and inject vigor to the growth engine, said analysts.

China will contribute 27.8 percent to total world GDP growth this year, according to an IMF assessment. China had also contributed 15 percent of almost 1,000 initiatives proposed by G20 members to help achieving the goal, said Chinese vice minister of finance Zhu Guangyao in a G20 finance minister meeting in October.

The Brisbane action plan, once announced, will be translated into specific measures in each country and region. China will continue stressing structural reform and innovation, and might also reiterate further cooperation and help to other emerging economies, said Chen.

Both Chen and Xu expressed hope to see a breakthrough in the IMF quota and governance reform that the IMF's Board of Governors approved in December 2010 but yet to be implemented. The package proposed a shift in quotas to dynamic emerging markets and under-represented countries.

China should have a stronger say in capital contribution and status in the organization, said analysts.

Apart from the economic agenda, a face-to-face showdown between Western leaders and Russia President Vladimir Putin over the Ukraine crisis is also expected to steal part of the thunder at the G20 summit, following recent reports of Russian troops pouring into eastern Ukraine.

British Prime Minister David Cameron slammed Russia's actions as unacceptable on Friday, warning that they could impose greater sanctions from the US and the EU, while Moscow denies the military advancement.

In an interview with Russian state news agency TASS, Putin, who has already arrived in Brisbane, said the sanctions harmed Russia, but also the global economy. He said he would not bring up the issue at G20 as "it'll make no sense."