 Hello, everyone. I'm Rola Khalaf, editor of the Financial Times. It's good to be here, and many thanks for all of you who are joining us. We have a great lineup for you this morning to discuss the government's response to the pandemic, the fiscal and monetary support that we've seen has been extraordinary. It's like the magic monetary. So we're going to look at the impact of the massive stimulus, the lessons that have been learned, and the current health of the financial system. Now, I'm delighted to be joined by Anna Botin, Group Executive Chairman at Santander and Hamad Al-Jadan, Minister of Finance of Saudi Arabia. Yi Gang, Governor of the Central Bank of China and Thomas Berl, CEO of AXA. A warm welcome to all of you. Just a word on the format of this session. I'm going to be moderating a discussion between the panelists for about 30 minutes, and then I will take questions from the audience. So I can see the questions in the Zoom chat, so please keep them coming throughout the session. Governor, if I may start with you, it's good to have you. It's been a year since the outbreak of the pandemic, which started in Wuhan. China's economy is recovering. Growth was up 6.5% in the fourth quarter. What are you projecting for this year? And the growth is still driven by the same playbook. Consumption is down, industrial production is up, still a big trade surplus. So can one speak of a more sustainable consumption led shift? Yes, that's a very good question. I think the Chinese economy is already getting more and more consumption driven. That is a healthy structural change. I think this is a sustainable trend, which will continue. As you said that you see we are in a pandemic crisis. Like January last year, COVID-19 became more severe in the world due to cold weather. The uncertainty of COVID-19 is on the rise. In China, you mentioned that they have been controlling the COVID-19 fairly well. Thanks to the rigorous measures such as varying masks, wash hands, tracing, testing and social distancing. So that they continue and consistent doing the above measures. So we can in general other control in China so far from the beginning of the pandemic. We have a worst beginning, but after a few months in Wuhan. And basically since last March, the country's large scale of COVID-19 has been by in large control. So that they still continue our measure. And we have also start the vaccine process as scheduled beginning with healthy workers and some other high scale group. And we will continue to take any active part in international cooperation. China will work for greater accessibility and affordability of vaccines in developing countries. Second, I want to say a little bit about China's economic and financial development under the COVID-19. Last year China GDP, as you mentioned, the last quarter of last year grew at about 6.5%. For the whole year last year, China GDP grew by 2.3%. Consumer price index is 2.5% and the unemployment rate last year is about 5.6%, which is lower than 6% the expectation. As of the end of last year, renminbi appreciate against US dollar about 7%. People's Bank of China injected more than 9 trillion renminbi, which is equivalent to 1.5 trillion US dollar liquidity into the market last year. And it also launched two targeted facilities to support micro and small businesses. At the end of December, broad money M2 grew about 10.1% and total social finance growth about 13%. So that's particularly the condition is pretty sound. The monetary policy will continue to prompting up the economy, but at the same time will also watch for the risks. One risk is the macro leverage ratio of China increased somewhat last year. The second risk is non-performance loans start to grow in. And also we also look at the external risk, which is look at the capital flow situation. Looking forward, I think our monetary policy will continue and they will keep a dedicated balance between supporting economic recovery at the same time preventing risk. We will ensure that the policy are consistent and stable and will not exit from supporting policy prematurely. You asked the prediction for this year. I think that we will largely depend on the assumption on the COVID-19 trend. My large probability prediction at this year, Chinese GDP will grow more or less along the potential growth level that is more or less resuming to the normal trend. And the third, lastly, I want to mention green finance. The COVID-19 crisis once again highlights the importance of harmony between man and the nature. It also reminds us the immediate risk of climate change. Today, President Xi reiterated that China, they are going to achieve a peak carbon emission before 2030 and carbon neutrality before 2060. The People's Bank of China, which is the central bank of China, stands ready to support this climate commitment through better resources allocation and risk management and market-based pricing by putting in place a green financial system. The system will include five pillars, namely, first, the system of green financial standard. Second, supervision and disclosure requirements for green financial institutions. Third, incentive and credit support for emission reduction. Fourth, the market of green finance products such as green loan, green bonds and carbon futures. Fifth, the international cooperation on green finance. Thank you very much. Let me just follow up with one question. I started by asking you about consumption-led growth. In the fourth quarter, there was no sign of any shift to consumption-led growth. I think the impact of COVID-19, they are directly on the consumption, especially service consumption, like a restaurant, party and airline and train traveling theaters and so on and so forth. So that in Chinese economy and consumption account for about 60% of the growth. But during the pandemic, the percentage of consumption decreased. And I think as we control the pandemic consumption will resume to the more or less normal level. And the other trend is right now in China, our saving rate is starting to decline a little bit every year. So that that is a good indication that more growth comes from consumption. Our export this year will continue to be pretty good. But I think the economic policy, the monetary policy, macroeconomic policy, physical policy, all focusing on maximized employment. If we have stable employment, that will guarantee very good consumption. So that by and large, our macroeconomic policy and the monetary policy would focus on consumption and make China to a smooth transition to a consumption-driven economy. Domestic demand would be by and large the most important and the bulk of the entire economy. Thank you. I'll come back to you a bit later, Governor, when we when we discuss fintech. I want to turn to the picture of course has been very different outside China and outside Asia. How do you see the medium term impact of the pandemic in Europe and the Americas? And then we'll move on to the financial sector specifically. Hello, Rula. It's great to be with you and everybody. So in Europe, clearly, we have suffered a lot in 2020. We're looking at the GDP. It's probably going to fall around 5%. And in this regard, southern countries like Spain, Italy, and a few others are going to suffer more. And my view is that for 2021, actually, this is my very strong belief that vaccination is the most effective 2021 economic policy. So obviously, this means uncertainty, but I do want to make a very important point and it has happened in the past. And that is when there is a crisis, Europe makes progress and there has been significant institutional progress in Europe during the crisis. And this is very important for the medium term. Just briefly, everybody knows the Reconstruction Fund. It's a historic initiative. We've never seen the European Union putting together $750 billion program and of course the ECB intervening early and decisively to make sure that national risk spreads don't go the way they want in the last crisis. So again, it's a critical step that Europe has taken towards federalization. For the first time, we have issued our own debt, the European Union and created taxes to service these liabilities. My last point is that the challenge for Europe now is how efficiently we use these funds and the governance. And of course, there's a conditionality which means reforms, which again are meant to speed up the digitalization and the energy transition. And Europe is going to do this together. And it's the only way to have a sustainable growth strategy. So great crisis, but also a great new opportunity. I like the vaccination is the best economic policy this year. Good line. Yes. Unlike 2008, the financial sector has not been at the heart of this crisis. In fact, it's been it's been quite resilient while the shock has been in the real more pronounced in the real economy. But I find bankers that I talk to quite sanguine about what could come next when the stimulus ends and bankruptcies begin. Or do you think banks are under playing the risks ahead? Well, look, you know, there is uncertainty, but I like to define myself and I define myself today as an optimist that worries a lot. So we do have to take great care. But the fact is the banking sector is liquid, well capitalized, highly regulated and intensively supervised. And this is something was a consequence of 2008. And we have not been part of the problem, but part of the solution. I mean, Santander has been lending one billion euros a day since the start of the pandemic with grown out loans. So, so yes, I do think, of course, we have to be prudent. Yes, there's a lot of uncertainty. I like to call this radical uncertainty and but there's a lot of good work that has happened. And we actually, you know, we do need at some point, I wrote about this in the FT a few weeks ago, do need to think ahead, how it is that the financial system can continue supporting the economy and can use the buffers that we have built in an effective way. So, you know, we need to be safe for depositors. We also need to support the economy, especially in Europe where banks are the majority of lending to SMEs, which are the hardest hit companies in this crisis, the most vulnerable, both companies and workers. Very true. Thomas, I wanted to bring you in here to talk about another risk, the impact of low interest rates. Much to celebrate there, but they are also creating asset bubbles. We're running, we just started a series yesterday about runaway markets. How worried are you and where specifically do you see bubbles? So it is true that, thank you, Roland. Good morning to everybody that low interest rates is certainly a concern. They were low before the crisis. They're even lower now. And the question is also how long will they stay low? And this is obviously a concern, certainly for the question around what is the behavior of economic actors when it comes to borrowing debt. But it also is the question, how do we make sure that we have sufficient savings and sufficient yield on the savings in order to pay for our retirements? For me personally, I do believe that the periods of low interest rates is necessary now in order to make sure that financial markets are continuing to work. That we can also, that states can also ensure that the necessary debt is being taken in order to cross this very difficult phase of the crisis. So it is absolutely necessary to have that. However, when I look forward, there are certainly clouds on the horizon. And one issue is clearly for me, how can we make sure that we exit this period of low interest rates in a way that it is on the one hand finding a good balance and not choking. That would be a very fine line. How do we get back to normality? And this is also then obviously linked as well to a second question. What is the reaction of the markets? It is clear that some markets have very, very high valuations today, in particular when you look at stocks. And so the question is, when it comes back to normal, what does it mean to these valuations? And how do we also see companies behaving when it comes to the exit from this negative interest rate period and low interest rate period? Because some companies have clearly been able to borrow that wouldn't have normally been able to borrow. And so this question around how do you exit the low interest rates period? How do you make sure that this is synchronized across the different geographies? And how do you make sure that this is a soft lending in also avoiding inflation coming back is certainly one of the major issues that the financial system needs to focus on post crisis. Indeed, it's quite a dilemma for policymakers because on the one hand, they need to avoid choking the recovery. But on the other hand, they don't want to encourage more risk taking. And it feels right now as if markets are assuming a very strong rebound in the second half of the year. As we see, though, and particularly in Europe, the vaccine and what Anna referred to as the most important economic policy is quite patchy. There's a lot more uncertainty. Do you think that this, I mean, do you agree with me that this is what the markets are assuming? And what should they really be looking at? I think when you both also look at us in saying that the financial markets have been stable, the central banks have really managed this first phase of the crisis extremely well. And we often forget that. And that I think is important to say, however, when we look forward, I do believe there is a clear risk of, I would say backlash. That pandemic lasts longer than expected. Because when you look at the scenario that the markets have been building in so far, it is very much based on a very strong rebound in the second half of 2021. And when we look at what we see today, the sanitary crisis still continuing, the delivery of vaccine rather slow than fast mutations coming up. And so the question is, how can the different states and the central banks accommodate this movement now with the necessary economic policy and accommodating for longer, making sure that also the financial discipline of the states is really kept. Because I think one thing is absolutely critical for me, which is the confidence in the financial markets. There is a lot of confidence now. We've seen that, as I said earlier, the economic actors have really managed the crisis very well. But there is also, I would say, no magic thinking. When I hear discussion coming up around debt cancellation, I would see that as a clear breach of trust of the markets. And for me, this would not be an option. When we look at other theories of getting back to a much stronger austerity, this is probably also not on the table. So finding the right balance now of continuing to manage the crisis well, but not destroying confidence in the market is something extremely important and extremely relevant for the success of this next phase. And very quickly, how do you rate regulators' performance during this crisis? You were critical of the European regulators' approach to dividends, for example, during the pandemic. So very quickly, how do you think they... I think regulators have managed this crisis very well because the 2008 crisis has been a very important learning ground for the industry. And we have certainly significantly increased the capital levels, increased the sovereignty, increased the prudence. And it has clearly shown that the majority of banks and insurers have survived and lived well in that crisis. So regulation does work. Where I do... where I did address my criticism was not on regulators per se, on the country, I think, that has worked really well, but was on the question around dividend payments and its consistency across Europe. If we live in a common Europe in which we should assume the same approach, the same regulatory approach, I would also then expect a very consistent treatment across Europe in terms of dividend payment. This has not been the case in 2020, but I have very strong hopes that for 2021 there is consistency and more consistency than 2020 around this topic. And then Sir Jadan said that the GPS presidency of the G20 was totally overtaken by the COVID crisis. And the main focus was on how wealthier nations could or should support the world's poorest nations. There was a debt relief initiative which enabled 73 of the world's poorest nations to suspend payments on bilateral loans. Did this deal go far enough? There has certainly been criticism that it hasn't, including from the World Bank. And there have been many calls for rich nations to allow the IMF to allocate more STRs. Should more have been done? And was the Trump administration the barrier? Thank you, Rola. And good morning, afternoon, everyone, wherever you are. I think 2020 has been a very, very difficult year for everyone. And Saudi is no exception. And during that time we obviously assumed the G20 presidency, but we're also we're dealing with two dual shocks of the pandemic and the commodities prices. But when it comes to the G20 itself, I think while we actually continued with the original mandate, the agenda that we have put forward at the beginning of 2019, we had to adapt very quickly. And the G20 kept together, had two summits in the same year. And they really, really believe that the G20 collectively acted in a very cooperative way throughout 2020. We started with the financing gap and the health, international health arena, where we cooperated with the EU and pledged north of 21 billion US dollars to bridge the gap in terms of research and development of vaccines, therapeutics and personal protective equipment. That was actually very, very helpful. And then we looked at what should we do in the short term and have very quickly, and for the first time the G20 have done this, adopted the debt service suspension initiative. We extended this, initially we agreed six months, we extended it to another six months, and then we agreed to extend it again if needed on April this year. Then we looked at the medium term and long term, and we started talking to the private sector, looking at ways that we can work with them, not only the multilateral and bilateral creditors, but also the private sector. And if I was in the shoes of one of the 73 nations or even beyond, I would love to see more action from the wealthier nations. I would like to see debt reduction, I would like to see debt forgiveness, but also at the same time, we need to make sure that we do not disrupt the market, we do not impose our will as sovereigns on the private sector. Otherwise we will harm these nations themselves, because if we force them to do any forgiveness, then they will not be actually making their money available next time to these countries. So we need to be really trying to balance that act, which we did. We worked with them, we adopted the new framework where basically we will look at each case, each of these countries in a case by case basis in terms of debt restructuring, and also for the first time the G20 agreed that they will look at debt relief at a sovereign level and forgiveness on a case by case basis if that's the last option. So there has been actually quite a lot of efforts within the G20, been talking to our Italian presidency for this year and they are continuing on that same line. They are continuing on the action plan of the G20, which actually for the first time monitors everything that the G20 committed to and what has been delivered. I am actually optimistic. While I hear my colleagues talk about the difficulties ahead, I think yes, we are not out of the woods yet, but I really believe that 21 is going to be a more positive here than what a lot of people think. So the Trump administration was not a barrier to doing more? You will be surprised actually Rona. I mean, I am, Trump is behind us now, but you will be surprised that one of the most cooperative G20 countries when it came to these initiatives, supporting these initiatives, as actually convincing some of the difficult countries who found some of these initiatives more difficult. Actually US and secret immigration was very helpful and I have received actually a lot of support, not only from secret immigration and the US administration, but also from Europe, from China. I think G20 throughout 2020 has been actually significantly cooperative. Let me ask you about the Covax initiative and the G20 pledge to ensure global access to the vaccines. That does not at this stage seem to be going very well and we know the risks of not vaccinating the developing world. What should be done here? Well, I think everybody realizes that if anyone is left behind, we are all at risk. So I think that is very clear in the minds of everybody, including the G20. We supported that accelerator, including the Covax initiative and that is continuing. Actually, I was talking to them last week and there are actually plans to increase and accelerate the vaccination distribution to the least fortunate countries. Saudi Arabia itself is thinking of a serious initiative to provide significant more support in actual vaccination. So we are negotiating with a lot of the vaccination companies to provide more vaccination to particularly low income countries in this part of the world and Africa. I think there is around the world available. That is right. That is absolutely right. In addition to Covax, we are trying to see what can we do to some of the countries. Yemen, for example, some of the African nations that cannot afford it and will not be able to get enough from Covax quickly trying to get something faster than that. Okay. Governor, I'd like to go back to you now and talk about innovation. The general view is that central banks have not really kept up with the innovation in the financial sector, whether it's FinTech, stablecoins, crypto, but they are coming around to it. So let me ask you what have been the benefits of China's FinTech revolution and how can the central bank at this stage ensure that tight regulation will not do more harm than that? Thank you. I think it is obvious to see that financial innovation, especially in the FinTech area, that promote financial inclusive services. So that make the financial services to a large number of people, including small and medium enterprises, low income people, and lower the transaction cost a lot. And also reaching far more deep in the markets that we haven't been reached by the traditional financial industry. So that benefit is obvious. But at the same time, maybe we can see also some risks like consumer information protection and also some monopoly potential and also some misuse of the monopoly power and so on and so forth. So that I think by and large people's bank of China in the past decade, they have been consistently supporting financial innovation, especially in the FinTech area, mobile payment services, inclusive finance, micro loans, and so on and so forth. I think the key point is that well, you have an environment that courage financial innovation. At the same time, you see the legal framework has to be very clear. For example, the ownership of the data and how to protect consumer privacy and also how to safeguard the abuse of some monopoly power. That is very important. And you know that people from China recently, they have announced the regulation on the third party payment regulation on mobile payment and also to protect consumers data that regulation in this regard. Also, at the end, I have to mention the international cooperation. The discussion internationally, especially in Europe, the recent two act version of market act and then also the other act discussed recently have been circulating around the world which provide a hint to us. That is, in order to do the innovation FinTech, because it's very easy to cross border so that we'd better to have international cooperation and jointly with Europe, with the US and other developing countries. Jointly, we can getting closer to a common consensus of the regulatory framework that would be a benefit to everybody, especially far benefit to the low income people by using the inclusive finance. That's very interesting that you're looking at the European acts. I wanted to ask you about and financial. It released, as you know, its practice in late August. It got the final approval from the China Securities Regulatory Commission to list in October. So, can you tell us why the IPO was stopped in November and do you think that the Securities Regulatory Commission made a mistake in approving it? I think it's a complicated issue. I want to mention that first everything is ruled by law so that we have to follow the legal procedure. And they obviously the security and IPO authority obviously find some problem and also some relevant agency is investigating the suspect problems related to monopoly. But you can see that every procedure is according to the legal framework and also they emphasize the protection of property rights and also they emphasize that this is a nonstop service to the financial market. You can see the mobile payment provided by RDA has been normal and actually the consumers feeling and the consumers satisfaction in the process is entirely satisfied so that I think as long as they follow the legal framework and everything according to the legal procedure and also have a general discussion of the society what is the general consumer wants and what their problem some of them complaining they are privacy being violated and so on so forth. But I would say that this is a process and also this prevents the problem solved it will go back to the track to continue consideration according to law. And lead to an IPO presumably. I would say that you just follow the standard of legal structure. You will have the result. Okay. Anna. FinTech firms have grown massively in recent years become better to banks. Jamie Diamond recently said that banks should be scared. I don't think I can say the word but it's SHI dot dot. Are you are you as scared as him? No look I would say the same thing as I say in general how I feel as a banker is that I'm optimistic that war is all the time. I think digitization is a huge opportunity. It's the path to growth to strengthen the financial system. It allows us to reach more people financial inclusion you know back to digitizing in certain countries in 2020 including the UK 80% of our sales have been through those channels. So all we need and I think Jamie said this I've said this many times we need a level playing field and I think the governor has alluded to that in three key areas. One is data. Second is access to critical infrastructures and third is innovation. So if you're asking banks to compete with a hand tied behind our backs that's not fair. If banks are required as we are in Europe to share our payments data with other companies as we are in the PSD to then others should be required to open their data because data is critical to being competitive in the digital economy. So we need to manage it in a way that is fair open and in the interest of citizens. And again I'm referring to Europe but the same would be said globally especially we want to avoid a future where we have two separate global economies. So again we need to fix this we need to fix this in an orderly way we're not asked for any favors when we make these we want to be able to compete fairly. And as again has been referred to by the governor the digital markets and data act would go a long way towards solving these issues. We of course have comments but we need to make these happen fast. And again we need to do this in a way that is diverse that supports the diversity fair competitive you know economy that we have in Europe. So we need international cooperation and we need to make this happen. Not just in Europe but globally. And you know that this happens. I am confident we can compete. I'd like to bring ministers and Thomas to a to answer a question from Manuela Stefania. No sorry the question is from Jurgen Richtering first vice president of the EBRD. And the question is what are the limitations of the so-called magic monetary. Minister would you like to take that one up. Two things let me just comment on the previous discussion. And I think this is actually very interesting. I think while I agree totally with the earlier comment I think still the conventional banks are underestimating the disruption that is coming from digital. Players I'm not suggesting that we should not provide level playing field. I think absolutely right. I think not only level playing here but also we need to protect the depositors money and we need to make sure that these people have actually money that does not belong to them. So they need to be subject to the same regulatory framework. But still I really believe that banks if they are not careful if they are not innovative enough. And quick they will be left behind. And this is not I'm not talking in Europe. I'm talking in Saudi and beyond and the region. So people should not underestimate what is happening in the digital arena. And when it comes to generally and I'll tell you in Saudi there will need to be a very delicate balance when it comes to what the monetary policy can do and can do. While we are a big currency to the US dollar and the central bank has limitations in terms of interest rates. But they have also a lot of tools as we have seen throughout 2020 to actually support the banking system to relax some of the regulatory requirements to ensure that the banks are and the financial system is stable and supportive. I really believe that what we are seeing now is that central banks are clearly playing a very clear role in terms of economic growth in terms of supporting growth and some supporting markets. But we also need to be very careful. We need to make sure that we balance between not inflating the markets and not causing even more risks but not all throwing or drawing the stimulus measures prematurely. I think we this is possibly the time when you need more stimulus package because now firms are thinking about yes things are looking positive. If we need to invest so we need to push them but you need to be very very careful and you need to balance what you are doing otherwise you could risk more than what you are benefiting the economy. Thomas we bear what are the limitations of the magic money tree. The question here is how do we make sure that the I use the words magic money tree remains an exception to manage a crisis and does not become a normality. To which we get used to over the next 10 years because it clearly if it was to become a normality has questions around the distortion of our economy. Lots of people are talking about this famous word of zombification so that yes the policy is helping the market in general to recover to survive to deal well. But we also do not want to take away the natural selection mechanism or market that favors the survival of innovative companies and also correct mistakes that companies have made that for me is the first And the second one is clearly a longer term one around the role of banks when you look central banks through this very very large program of monetary policy are in effect taking decisions on the allocation of credit in the economy which traditionally was always the role of the banks And I think this remaining an exception an exception and not becoming normality is very important also for the functioning of for the good. And this combined with what is the role of traditional banks versus the central banks in the long term so just two limitations that I think are important to clarify as this continues. A good note on which to end this panel because we have to end it we have run out of time exception rather than normality but also I say this in the hope that we are going to return to some form of normality in the coming months. Thank you to my panelists for a fascinating discussion and thank you to the audience for listening to us. Have a great rest of the day.