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Roundup: Microeconomic Policy Plays Important Role in Global Economic Recovery
The consensus reached by the delegates at the Eighth APEC Finance Ministers Meeting (AFMM) was that the world economy is in a crucial period, and it is important for various economic communities to adopt micro policies to promote sustained economic growth.
Since the trade volumes of all APEC economies occupy 45 percent of that of the world, the AFMM has caught the world's attention.
During the Eighth AFMM held in Suzhou from September 8 to 9, the APEC finance ministers and representatives from international organizations exchanged views on microeconomic policies, coping with risk and striving for sustained economic growth.
Horst Koehler, managing director and chairman of executive board of the International Monetary Fund (IFM), said that the world economy is expected to regain its vitality late this year, and some favorable factors will trump the unfavorable ones.
Meanwhile, many participants agreed that the APEC economies are now better prepared to cope with the uncertainty in the world economic situation than they were during the Asian financial crises in 1997 and 1998. They have confidence in the world economic recovery.
Singaporean Finance Minister Richard Hu Tsu Tau held that the economic slowdown of the U.S. will continue till the end of next year, which will obviously drag down the recovery of world economy.
The World Economy Outlook of the IFM estimated that the growth rate of the world economy will reach 3.2 percent this year, 1 percent lower than the estimation of last year.
Peter Costello, Australian Minister of Treasury, said that there are some economies in the Asia-Pacific region still maintaining strong momentum for economic growth like China, Australia and India.
Xiang Huaicheng, Chinese finance minister and chair of the Eighth AFMM, said that China has carried out a microeconomic policy with an active financial policy as its core, and although the world economic slowdown affects China's export, it can be counteracted by expanding domestic demand. China's economic growth rate this year is expected to reach 7 to 7.5 percent.
The U.S. treasury secretary Paul O'Neill said that the U.S. government has adopted policies such as lowering the interest rate and reducing taxes, and he is optimistic about recovery of the U.S. economy.
Sven Sandstrom, managing director of the World Bank, pointed out that globalization makes all nations more interdependent, and the U.S. microeconomic policy will affect its demands for exports to the Asia-Pacific developing economies and the newly emerging market economies.
The financial reforms undertaken by the southeast Asian economies since the Asian financial crisis have made achievements, he said, adding that this will improve the world investment.
Koehler said that the current readjustment in the economy will help the world maintain sustained economic development, and he is cautiously optimistic about the prospect of the world economy.
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