In a wide-ranging speech opening up the World Economic Forum in Davos, Chinese President Xi Jinping called for a reform of the system of global governance, in what might be labeled “globalization with Chinese characteristics.” Warning of the dangers of a retreat into a defensive protectionism in the face of the financial storms, he said, would be like locking yourself in a dark room, where you will be protected from the rain outside, but will also lack light and air to breathe.
At the same time, he decried the failures of the present global system, the growing inequality, growing poverty and unemployment. And yet, “the history of man tells us,” Xi said, “that problems should not be feared, but have to be faced. We have to meet the challenges and chart the right course for economic globalization… If one is afraid of the storm and exploring a new world, they will get drowned in the ocean sooner or later.” Referring to China’s own experience, he said “We have had our share of choking in the water and our share of whirlpools,” but “the global economy is a big ocean and you can’t escape from it, nor can you retreat from it.” Xi also warned against a trade war, saying that “no one will emerge a winner in a trade war.”
Speaking of the world financial crisis, Xi said that this was not caused by “globalization,” but rather by “finance capital taking out excessive profits and by the failure of financial regulation to deal with it.” While globalization has created significant problems, the mechanism for resolving these problems has failed.
“Inadequate global governance makes it difficult to deal with these problems,” Xi said. “There is a resounding call from the international community for a reform of the system of global governance which is now a pressing task,” Xi said. “And all countries are equal members of the international community and deserve to be heard.” Furthermore, he went on, “Global connectivity must be developed in order for all to reach prosperity.” The center of this “globalization” is development, and development is based on increasing productivity based on the development of science and technology, Xi said. “This is a product of all of us and not the product of one individual alone,” Xi said. Quoting Lincoln (and Sun Yatsen, without mentioning either), Xi said “Development is of the people, by the people and for the people.”
The world community has to develop a “dynamic innovation-driven growth model,” he said. Only through innovation and reform can we deal with the sluggish economy. Secondly, “we should develop an open and interconnected approach to a development of open and win-win cooperation.” And thirdly, “it is crucial to have a sound development philosophy and model,” that is “balanced, equitable, and inclusive.” “Priority should be given to reducing poverty, unemployment and inequality,” Xi said.
Xi assured his listeners that China would stay the course, maintain a solid growth rate, continue its structural reform and opening up, and play a greater role in sharing its growth with others. Xi pointed to the Hangzhou G-20 Summit, which placed innovation in the center of economic development, and to the Belt and Road Initiative, which will hold a major summit in May in China. “If we continue to build a community of a shared future for mankind,” Xi said, “we can create a better world.”