ZCZC
BCN-21
CHINA-TRADE-WORLDBANK
World Bank chief tells China it needs ‘vital’ reforms
BEIJING, Nov 21, 2019 (BSS/AFP) – World Bank chief David Malpass urged
China on Thursday to further open up its economy and reduce state subsidies,
echoing key demands made by the United States in protracted trade war
negotiations.
Malpass made the remarks after a roundtable meeting with Chinese Premier
Li Keqiang and the heads of other global institutions, including the
International Monetary Fund and the World Trade Organization.
“I encouraged new reforms and liberalisation,” he said.
Beijing is struggling to kickstart the economy, which expanded at its
slowest pace for nearly three decades in the third quarter amid cooling
global demand for its exports and a looming debt crisis at home.
Malpass said Beijing must resolve bilateral trade disputes and improve
transparency in lending to avoid a sharp downturn on growth over the coming
decades.
“China could improve the rule of law, allow the market to play a more
decisive role in allocating resources including debt and investment, reduce
subsidies for state-owned enterprises… and remove barriers to competition,”
he said.
“It is hard to achieve but it is vital for reducing any inequality and
building higher living standard,” Malpass said.
State-owned behemoths dominate lucrative sectors of China’s economy —
including energy, aviation and telecommunications — where access to private
players is restricted.
China’s trade partners have also long complained about the lack of an
equal playing field and theft of intellectual property.
The country’s rubber-stamp parliament in March passed a foreign investment
law that promises to address these issues, but local governments are still
working on detailed rules needed to implement it.
Li said both domestic and foreign companies registered in China will be
treated equally.
“They will have equal access to investment opportunities, equitable access
to resources, legal protection in accordance with the law,” he said.
Beijing has also announced a timetable to open up its financial sector to
foreign investors next year, as it attempts to woo outside capital to shore
up an economy battered by the trade war with the United States.
China and the US have slapped tariffs on over $360 billion worth of goods
in two-way trade.
Negotiators from both sides have been working towards a partial deal, but
US President Donald Trump on Wednesday said Beijing has not made sufficient
concessions, making him reluctant to conclude a bargain.
Economic data shows the uncertainty created by the trade spat between the
world’s two biggest economies is undermining global growth.
IMF chief Kristalina Georgieva warned that implementing all the announced
tariffs would cut $700 billion out of the world economy next year.
“What should be our priorities? First, to move from trade truce to trade
peace,” she said.
BSS/AFP/HR/1300