Common development requires more cooperation

By Cao Honghui

The world is facing various challenges including COVID-19, de-globalization, geopolitical conflicts along with the energy and food crisis, as well as booming inflation, reversal of worldwide extreme poverty reductions. We should anticipate worse times ahead, such as the slowdown of the annual global economic growth rate dropping to 2.7 percent next year as forecasted by the International Monetary Fund. One third of economies would likely slip into recession.

There's a push for de-coupling in industry competition and high-tech development based on the great-power rivalry, which cause negative spillover effects due to a lack of coordination of monetary policy among the major economies. Hence, there are greater challenges for multilateralism based on the WTO mechanism and G20 global economic governance system. The solution from the 2022 G20 summit in Jakarta and APEC Bangkok meeting appeals for all members to join hands on common recovery without dividing the world. The major economies are the main undertakers for the stability and development of the world.

Only multilateralism and openness can revitalize international cooperation. It's urgent to move forward on food crisis prevention, poverty eradication and inflation curbs by requiring more inclusive, sustainable and pliable measures. The diplomatic meetings hosted in Southeast Asian countries this week demonstrate that Asia Pacific leaders can enhance stability for the world and strengthen Asia's role. More than 100 countries and international organizations have expressed support for the Global Development Initiative to forge a multiple-partnership network.

Benjakitti Park in Bangkok, Thailand, November 12, 2022. [Photo/Xinhua]

The Asia Pacific community endorses innovative growth, connectivity, win-win cooperation by fostering various regional initiatives and mechanisms to include the Regional Comprehensive Economic Partnership Agreement, Comprehensive and Progressive Agreement for Trans-Pacific Partnership, Digital Economy Partnership Agreement, and Free Trade Area of the Asia Pacific. Threats to regional stability and development would be countered by the people here.

The WTO system should remain a non-prejudiced, free, fair, open, inclusive, sustainable and transparent. The suppression of Chinese companies in regards to microchip manufacturing and 5G telecommunication equipment developing has caused serious concern worldwide, since it might not be an isolated case in the great-power competition. More coordination between the great powers can reform the WTO system. Prompt actions should be taken to cease government meddling over national security or other political issues disrupting the markets. This can ensure smooth operation of the global industrial and supply chains that are critical and timely for global economic resurgence.

Developing infrastructure building can enhance regional connectivity as well. The China-Laos Railway, linking Kunming city in southwest China's Yunnan Province with Laos' capital city Vientiane and its supporting facilities have performed better than expected. Needed are more investment in infrastructure like the internet and pipeline networks, along with new energy to promote industrial upgrades. Accordingly, the new energy vehicle assembly plant in Indonesia invested by SAIC-GM-Wuling Automobile serves as one great example.

Additionally, the industrialization of digital industry plays a vital role for the economic revival, which requires a free flow of cross-border data, more investment in digital infrastructure, and digital technology development. It's important to support deeper international cooperation in digital trade as well. The more cooperation we have, the smoother the industrial and supply chains will be, as well as globalization enjoying more gains.

Cao Honghui is a senior expert at China Development Bank and a professor at the Chinese Academy of Social Sciences.