In his video message to the Expo, President Xi committed China to ‘take a constructive stance to reform the global economic governance system and promote an open world economy’, also stating that ‘the overwhelming trend for countries to move towards openness and co-operation remains unchanged’.
He noted his expectation that China’s market will continue to grow, and more importantly consume. ‘With a population of 1.4 billion and a middle-income group exceeding 400 million, China is the world’s largest market with the greatest potential’. Xi added that China ‘is expected to import an accumulated over $22 trillion worth of goods in the next 10 years’.
However, as our Chair has noted, China has embraced a state-led economic model with a high level of market distortions. As a result, China among other such nations and economic blocs, have a tendency to wish to co-operate on the basis of regulatory harmonisation or regulatory coercion.
Nevertheless, President Xi’s most recent intervention, if it is not merely for show, may indicate his recognition of the dependence of China on open markets for future growth. Such a statement should be cautiously welcomed.