OPINION> Commentary
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OPINION> Commentary
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Holding the bottom line
(China Daily)
Updated: 2009-03-31 07:43 With the G20 sum-mit in London fast approaching, many British newspapers and indeed many columnists across the world are reflecting on the collapse of the London economic conference in 1933. That was a failure that not just prolonged the recession but led to even greater disasters. Therefore collective action, or a united front, as people are calling for, is needed from the largest economies in the world. As people have seen many times, no country can remain unscathed by a worldwide crisis. Even less can they expect to make an early recovery by not helping others - its past and future partners. In fact, countries need to act together to do even more than in the good times, when trade kept rising and capital (perhaps too much of it) kept flooding stock markets in every corner of the globe.
This time around the London summit, which starts on Thursday, has a big agenda. However, it may prove impossible to establish a united front on things such as concerted stimulus packages, worldwide financial market regulation, and reform of the IMF (not just enlarging its capital capability). They are issues on which countries may still hold different perspectives and interests. Some issues may require many rounds of talks before agreement can be reached on details, even with a generally agreed set of principles. But two things are relatively more straightforward and this year's G20 had better not leave them unresolved. One is the bottom line for the very existence of the global market system - oppose protectionism. G20 members should all take a strong stance on trade, as they represent 85 percent of the world's economy and nearly as much of its trade. They all share more or less the same interests, in merchandise and in services. Yet in order to effectively defend free trade, the G20 need not just pledge but take action to refrain from competitive devaluation of currencies and commit anew to trade liberalization talks within the WTO framework. The other measure the G20 must also take is to send the world a clear message to keep looking ahead and opening to new ideas. Some parts of globalization may have been managed poorly in the past decade or so, but that does not mean that globalization is inevitably grinding to a halt. Instead, it is the institutions charged with facilitating globalization that need improvement. The crisis nowadays is creating a demand for suggestions as to how that can be done - step by step. No suggestion should get a cold shoulder. They certainly deserve more of welcome than not contributing ideas. (China Daily 03/31/2009 page6) |
