After a mere four-and-a-half hours, world leaders at the G20 summit in London decided to devote about 1 trillion U.S. dollars to supporting world economic growth and trade, an outcome that surprised many analysts with its scale.
But in that scant time, China had a chance to showcase its growing importance in the world economy. China said it would contribute 40 billion U.S. dollars to the International Monetary Fund's (IMF) increased financing capacity. That's only a small portion of the total, but it could take China's IMF voting rights from to 3.997 percent from 3.807 percent.
China's new voting share would still far behind that of the United States, which is first with about 17 percent.
However, since many countries' voting shares in the IMF are well under 1 percent, any incremental change gives a member just a little extra say in the workings of the multilateral organization. And so the potential change is a small step toward China's goal of having more influence on how the IMF, and the world financial system, operates.
HIGHER FINANCIAL STATUS
Economists said China's proposed contribution of 40 billion U.S. dollars was in line with its current development level and would mean a more influential voice for Beijing in international financial institutions and in shaping the world economic order.
"China's promise of extra funding was a contribution to the world economy and showcased the country's clout," said Zhao Jinping, an economist with the State Council's (cabinet's) Development Research Center.
Tang Min, deputy secretary general of the China Development Research Foundation, said the country's voting rights and quota of contributions to multilateral bodies still fell short of its status as the world's third-biggest economy.
He said China would further step up its contributions, and influence, as its economic power grew and reforms of the international financial system went forward.
Zhao said it was part of a long-term trend for developing countries like China to have more influence in decision-making at international financial institutions, noting that the "obsolete mechanism and structure of world financial organizations" failed to reflect an evolving world economy.
British special G20 envoy Mark Malloch-Brown was quoted in the China Securities Journal on Thursday as saying that an overhaul of the world financial system should start with international financial institutions and reforming the IMF meant China's voice must be bigger.
The G20 leaders' statement was a "positive signal" in that it gave a timetable for reforming the IMF and the World Bank, said Zhang Bin, an expert with the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, a government think tank.
Zhao said China's obligations to international financial institutions should reflect not just the country's size but also the fact that China is still a developing country.
He urged China to expand its influence by actively joining multilateral or regional dialogues and offering more proposals on international issues.
"It should be a step-by-step process for China to shoulder more responsibility. It can't be accomplished in just one move," said Zhao.
LONG ROAD TO REFORM
Be it "a turning point," as U.S. President Barack Obama stated, or "a new world order," as British Prime Minister Gordon Brown claimed, the G20 summit was a major step in reshaping the global financial system, but there was still far to go, Chinese economists said.
"China should seek to expand its IMF quota and voting rights further after the summit. Although the statement give a timetable for reform, it remains unclear whether the goal can be achieved because that would affect the interests of the United States and the European Union," said Mei Xinyu, a researcher at China's Ministry of Commerce.
The G20 statement reads in part: "We commit to implementing the package of IMF quota and voice reforms agreed in April 2009 and call on the IMF to complete the next review of quotas by January 2011."
"On the one hand, China could count on the IMF restructuring, and on the other hand, it may start again somewhere else. For instance, it can push forward the establishment of the 120-billion-U.S.-dollar reserve pool agreed by several East Asian countries," Mei said.
Leaders of the 10 members of the Association of Southeast Asian Nations plus China, Japan and the Republic of Korea agreed last month to speed up the creation of a foreign-exchange reserve pool of 120 billion U.S. dollars to address liquidity shortages.
Mei described the pool as an "Asian Monetary Fund," saying it could partly replace the IMF in Asia and help increase use of the Chinese currency in international trade.
Another government economist, Wang Xiaoguang, said the agreement served as a foundation for more concrete policies to tackle the global downturn and this would be good for global stability and China's own economic recovery.
Wang added that it was unrealistic to change the global financial order immediately, because it would cause conflicts among major economies.
"They will rework the current system rather than introduce a new one," he said.
Zhuang Jian, an economist at the Asian Development Bank, said the biggest challenge was how to implement those commitments. China should closely monitor the implementation of the agreement and decide whether its short-term objectives could be realized.
"China's appeals will be discussed after the summit," he said, referring to financial market reform and the position of emerging countries in the international financial system.
"I think the country will have a bigger say in the global financial system. But the G20 summit is just a forum, and if the global economy worsens, the agreement might end up as nothing more than words," he said.