 So Could you take your seats? Okay, well we we will start and I have to say that we have a question which is extremely stimulating is International economic order Collapsing question mark and we are very privileged because to respond to this question. We have a group of panelists Extremely Diverse with angle of visions that are complementary very different And I take it that to respond to a question, which is so multi-dimensional So multi-layered it is good that we have such a panel. Let me introduce the member of the panel We have Taiho Park He was minister of trade of the Korean government I know to with great satisfaction that I always chair of the Korean committee for the trial at all Commission I know that on pass on he's a presently president of the global commerce Institute of And a leading global law firm in Korea Leonhardt Co Yann Cotanson is CEO of data core innovations a limited liabilities company member of the board of the Paris school of Economics and he just published capitalism against inequalities, which is a great book. I have to say Gabrielle Felbert May He is he was the the I would say chief of the famous IFO Center for international economics at the University of Munich Munich and a who has a president of the Kiel Institute for the world economy is Presently director of the Austrian Institute of economic research and it's a privilege to have you here Moto Shiger Ito Professor Emeritus of the University of Tokyo has been an advisor of the prime minister And I have to say I was very impressed when I could see your own personal library With the 40 books that you wrote very impressive John Lipsky is was deputy first deputy a managing director of the IMF acting managing director and This presently senior fellow of the foreign policy Institute at John Hopkins Paul needs a school of advanced international studies and then we have Carol Ede Secretary General and vice chairman of Shanghai Development Research Foundation Dedicated to promote research and the issue of development. He previously was managing director of New York life in China Nicola veron Last but not least senior fellow both at Bruegel in Brussels and at the Putterson Institute for international economies in DC and He's one of the founding father of the think tank Bruegel Now, let me say that we have here And it's very impressive. I have to say three Asian Panelists out of seven. I think that to capture that structural transformation of first magnitude are emerging in the global economy It was a very good sign that we could have three speakers coming from Asia And let me let me Say just a few words because we have to be very concise All panelists have accepted to speak five minutes first in order to communicate their main messages and then we could have a new round of Discussion in order again for you to benefit from the multi angular multi I would say dimensional vision that we have in the panel and then we go to the to the audience so Very rapidly first many many shocks in the global economy since I would say The post World War two and Brighton would System and so forth each of these shock Collapses of yet union collapse of the Redwood system Emergence of the emerging world rise of Asia and of China Very spectacular each of these phenomenon would have called for a new global economic order each of them It's also particularly striking to see and it was Mentioned and stressed very very well in the previous panel that there is an acceleration of this transformation both structural transformation accelerating with a remarkable speed in a way War in Ukraine is an illu in Emblematic illustration of these incredible and rapid transformation that we are witnessing of course, there is a very close correlation between Geo strategy and economics now The question should we have a new international economic order? I I guess that the response is yes because checking what has been said I could see that all speakers whether president of the US whether President of all countries in the world whether president of China. They all say we need a new International order implicitly or explicitly a new economic international order So the problem is which one exactly which International order that is new that would be appropriate to the new world in which we are would be appropriate would should it be Multi-polar or unipolar the response. Yes again is yes Yes, we need a new international order. Yes, it should be multi-polar not bipolar Not many unipolar, but again, which kind of multi-polar and then again, I expect all of us to comment on that Some of some have in mind bipolar. They say yes implicitly should be west versus the rest of the world democracies versus authoritarian regime global north versus global south and There are a lot of implicit response on this so-called Multi-polar world which in the mind of some would be bipolar Should it be a real multi-polar world with the US? Europe China the emerging world Russia, so which constellation of different poles do we see in this new world and That is of course a question for Many many many countries many culture to respond Because it's not obvious which kind of multiple of your world we we would like to have and then There is the real question the dramatic question shared global rules or no shared global rules Taking into consideration Global public goods or not taking into consideration global public goods at the level of the planet and again, I Would say I hope that the majority of us will say yes, we need shared Rules we need to Recognize that we are in on the same planet, but we will see what are the response and let me turn to the first speaker Please you have the floor. Okay. Thank you. Mr. Chairman. Are you raised so? Important, but very difficult question. I don't know whether I have an answer to that Since I'm a trade expert. I will say something about the trade area starting with a brief remarks on issues related to the supply chain global supply chain and possibly I want to touch upon the possibility of future world trade governance I will start with the three major causes for the recent global supply chain restructuring First as you know very well Covid-19 pandemic and the war between Russia and Ukraine in various sanctions against Russia are causing supply chain disruptions second the US measures Trade measures based on the national security concerns are also causing supply chain distortions For example, I think you know this will very well additional tariffs on steel and aluminum Also quarter imposed on a South Korean steel export and export control on China for a semiconductor and semiconductor equipment distorting trade in those products third trade policies based on politically motivated nationalism, which prefer domestic production and reassuring Also causing supply chain restructuring. So all of these affecting international trade and supply chains of global firms Looking at these development several concerns are emerging First, we noticed that countries like the United States Which have criticized China for giving heavy government subsidies in specific sectors now provides Industrial subsidies to promote their own domestic sector like a semiconductor According to US chips and science act the US government will provide $52 billion of subsidies in semiconductor sector This means the industrial policies could be revived in most countries including the United States and probably the EU triggering industrial subsidies competitions among major countries We worried that this might we might lose the opportunity to reform the rules on industrial subsidies at the WTO Second some trade policy measures based on national security concerns green economy or Politically motivated nationalism such as those in the US inflation reduction act may violate The WTO rules of MFM principle and the national treatment For example, the IRA include tax credit provisions Which it discriminate against electric vehicles produced or assembled outside the North American region Regarding these aspects of the US legislation some trade experts Including those even in the US are questioning whether US is in support of defending and Reforming the rules based multilateral trading system or simply pushing for anti-China as well as America first policies The third concern is about the issue of decoupling between the US and China As you know very well the US economies and many other Economism world already deeply interconnected with Chinese economy through many years of globalization and trade Therefore it may not be realistic and even infeasible to suddenly cut off all trade between the US and China I think we should consider limiting the US decoupling from China to a few technologically sensitive sectors which are directly related to national security Even in the case of semiconductor the coupling should focus on a few technologically advanced chips Lastly but not least I have another concern which is related to the decoupling issues. I have just mentioned We now know that the Indo-Pacific economic framework participating countries Discussing the content of the agreement of the IPEF proposed by the United States Of course, we don't know we do not know the details yet But probably in the second pillar of economic in the Pacific economic framework There'll be some provisions for supply chain resilience Which might exclude China in their supply chain for certain products and materials If this is the case, we can easily expect China to react in one way or another as So trade experts are actually saying that these kind of a confrontation between IPEF participating countries and China might be leading to a serious kind of trade war Which we are really concerned. Well, these are my concerns to share with you as a trade economist I do not see the World Trade Governance We talk about that in the first session particularly the multilateral trading system of the WTO Properly deals with these issues these problems for the more no major countries formally raise this Concern these days. So in this context, I would like to suggest that the WPC Participant start to raise appropriate voices. I particularly think that our session is the right place to discuss Some ideas about the future global trade governors. I don't provide any specific solutions, but I raise the issue Well, I stop here. Thank you very much. Thank you. Thank you very very much in detail It was very very clear and this danger of nationalism Introducing its own fragmentation at the global level and also the decoupling between US and China that you mentioned and The potential war the potential trade war is extremely important in our perspective. Let me turn to Monsieur Cottenlem Que pouvez-vous nous dire monsieur? Thank you and good morning I cannot tell you if we need a new order if or if we can tweak the existing order but I can tell you what I want in it and I'd like to make this morning two very concrete proposals that I think can Contribute to the common good and I will start number one with macroeconomic and financial stability and in a way, you know, how can we revive the Pittsburgh G20 summit spirit at least Something that would have been very useful going back to 2008 Is the idea of what I would call a global financial contagion model So in other words, how can we anticipate domino effects? Across many counterparties countries regions of the world, right? Some work has been done already at a country level usually at the request of a central bank I'll just name Brazil as an example You could argue that in the EU Amir, which is the European market infrastructure regulation framework Would have most of the data to perform such an exercise But we need to actually do it and then do it globally. I think that that would be very important more generally, I think it would be very useful to have what I would call a extreme risk measure of the entire world economy Across many dimension not just market and credit risk, but also climate change cyber security Operational risk you name it Nothing new in a sense We know we can reuse the models and the stress tests that are already applied to institution dim too big to fail And once you have what's called in the jargon of the regulators a stress value at risk For the entire financial system You should have the ability to essentially slice and dice Amongst all institution and risk factors so that you can act attribute risk where it belongs I think that would be a very useful Of course that will require us to stress this all financial institutions Not just you know too big to fail and that includes shadow banking that include sovereign states themselves and that includes fintech and you know We shouldn't be taken by surprise when a Cryptocurrency exchange collapses, right? I mean there's something that doesn't work here And so to conclude on this first point having a common risk Frameworks help us find common interest which I think is the key to international goodwill Not treat is not really rules not really pressure You name it. So to me common interest Can change the balance of power? very little else So number two in my wish list and it's quite different, but it's related equality of opportunity for Companies countries and of course individuals I go much deeper on this issues in my letter's book Look at pitalese control is in a good day, but here is our few important points First and I'm talking about companies first Did you know that one person of companies control? 98% of the patterns that are actually useful. It's it's a staggering number and so if you look for instance at the Fascinating example of genetic drugs in the United States. It started 40 years ago today 90% of Prescriptions are done on the basis of genetic drugs. So you may say well, it's a great success, right? unfortunately, cost of prescription medicines have continued to increase overall and and you could argue that Innovation has been deterred by essentially price-gadging What happened while patterns were too much abused? so this is to me a perfect example of excessive rent and That amounts in a sense to what we call in the book to Pivot taxis, especially if you look at the net effect, right? Because what you see is a rent going from all of us to say the top 1% of people, right? So that's highly regressive And that number exceeds the tax redistribution from the top 1% to the rest of the of the population So net net you have a fairly regressive Impact equities also about fighting externalities first of all climate change and the question is, you know Do you do it according to say noble price winner? William Norders by creating a club structure with penalties For countries outside the club so we can meet our carbon emission goals much faster than today Or should we create a compensation scheme for poor countries like? The phone proposed by the cup 27 just two weeks ago In fact, I think we should do both because then you can provide Fairness to the system, but at the same time Without perturbing the price signal too much. I think that's important And then a final word about equality of opportunity for individuals this time The key to me is optimized human capital over the entire life Of people and that is tricky for governments because they need to do more long-term planning, right? Always something difficult for governments So they need to be firm their ability to monitor the performance of public policies better Both in terms of return on investment and so you can prioritize what you're doing But also in terms of fairness of the welfare system, and I will stop here Thank you. Thank you very much in this. I take your your message as concentrating on maybe Let's continue to have a g20 a financial stability board and all what goes with it Continuing to function and it would be part of your message on maintain rules at a global level and Let's not destroy what exists and still exist at the moment We are speaking even if it is not perfect and I take your point on fairness for firms fairness for individuals as a very Important message also. Let me turn to Gabrielle Felber mayer. What would you suggest sir? Thank you Claude and thanks for having me It's the global order collapsing. That's the question of this panel And I would say it is certainly under tremendous stress But I don't think it is collapsing and I'd like to make five points to to shore up that that view First of all if you look back in history Claude you started with this. I think we have seen crisis before and of course every crisis We are in right now seems like the biggest we've ever had but There's been shocks to the global system the withdrawal the unilateral withdrawal of the United States of In the early 70s from the gold standard then was a big issue and it traumatized many countries including in Europe The Bretton Hood system never was a global system truly speaking It was a system for the first world as we said the second world the communist world was not in the third world Mostly was colonized when the Bretton Woods would system was engineered so I think looking back into history tells us that we have had shocks before and rather than going for Collapses we've seen transformations and relatively strong transformations like the Change in the early 70s out of the gold standard the second point. I would like to make is we should Not only look at the institutions and at the legal compact that's of course very important But if we look at outcomes The picture looks better Certainly the institutions are in trouble So the WTO is not having a functional appellate body right now, which is bad, of course the IMF has lost ground bilateralism has has from has Gained ground over multilateralism and so on all that is true But if you look at outcomes what we see is indeed a surprising degree of resilience and You know that the picture and the data that we have is somehow out of sync with much of the discussions we see for example trade so the Global financial crisis 2007 to 2009 Brought a big recession in trade and so did the COVID-19 Crisis, but then the systems Reconverged so today the latest latest data tell us that the price adjusted trade is 10 percent higher at the global level Then it was immediately before the onset of the COVID-19 crisis So we see that amount of resilience and I think that should give us hope It means that's my third point that the global order is not just about rules and institutions it is about the whole network of economic ties about the resilience of a market-based global community and that resilience I think is is is great and stronger than What many observers believe? There's a cooperation going on I mean we talked a lot about the breakdown of cooperation and I'm not denying that but we see cooperation for example in the era of international taxation with the In position of a minimum tax was an unexpected victory We see cooperation in the area in the area of competition policy So that's that's potentially a very difficult field, but here things work not Not too badly and it's interesting that we see cooperation precisely in those areas where we don't have much of an institutional compact There is no world competition authority yet. We see countries cooperating in this field and so I think what is really important is that we do have areas where we have a convergence of fuse where the Epistemics are aligned Everyone tries or most countries are convinced that the that excessive market power of very few players is dangerous Most of them believe that we need financial financial stability I think there's no doubt about that and where we have this Epistemic convergence. I think international cooperation is much easier with my fourth point Is about things that have changed and think establishing consensus about that is important to go forward The first thing that has changed is that global commons met are more than ever So despite of talking about the globalization We see that what happens around the world is becoming more and more important for our own faiths and that will not change Climate change is of course the big issue number one, but it goes beyond that. We have seen the pandemic We have concerns about the quality and and the health of our oceans of biodiversity Diversity we have issues about global terrorism. All these are global comments that Make the world war global and require more cooperation rather than less The second thing that is that is I think important it will stay is that we witness Divergence of preferences Everywhere not just between the big blocks. We see that also within Europe The countries of Europe diverging in views of how the future should look like we see that also within our own societies You know the polarization in the United States polarization also in European Societies is much at the at the origin of of the Troubles that we're seeing right now and the third thing that that will stay with us is a return of geopolitics and geopolitics I think that the period from 1989 say to 2008 was extraordinary This very short period actually of not even two decades Which is not the historical normal and so we're going back into into a situation Where countries are at the same time? partners competitors, but also rivals and have to embrace at the same time a positive some environment That's the world of trade and finance a zero-sum Environment, that's the world of power struggle where only one one can win and a negative some environment where our actions could could reduce the global prosperity and The fifth point I would like to touch on is what it can be done and what could be lines of Agreement I think we should indeed focus more on outcomes rather than on the institutional and legal structure Not saying that the latter are important But outcomes are what matter finally for people the environment for global health and so on we should focus more on what works So a call for pragmatism and what works today might be very different to what worked five years ago or 15 or 50 years ago I think we should we should have a more broader perspective on the institutions that matter These are not just IMF World Bank the World Trade Organization World Health Organization, etc This includes the big multinational enterprises that we need to mobilize for the common good this includes the public Public and the civil society NGOs and many more I think we should also look at the future that we're talking about China in the United States What about India India is overtaking as we speak China in terms of its population and if it's if it catches up in terms of GDP per capita, it will outgrow China at some point. What about Africa Africa will be the place with the biggest Population not far away from us We should be talking about the future and shape Institutions that work in the future and not just look at the present and the last point I would like to make here is that I think there's a minimum consensus Where I don't see much divergence and that is we need transparency We need for a transparency about policies. We need a dialogue and we need Accountability in the sense that there is monitoring of what's going on by independent institutions that everyone trusts That is a very short list of minimum requirements But think if we can establish that and and take that out of dispute Then we would be quite some some some way further. Thanks. Thank you. Thank you very much indeed Gabrielle I I take it that All taken into account with all the challenges of all kinds that we have to cope with you remain confident You remain confident on what has been done in the past and what should be done and could be done in the future Thank you very much indeed. Let me turn to Motoshi gay ito Thank you. I think the your first comment about the Unipolar Versus multiple globalization is very relevant when we are thinking about the process of globalization We probably have to think that at least two or maybe more different type of globalization and deglobalization and Each has its own Momentum so in order to just make it point more clear. Let me first discuss the case of semiconductor industry Which is maybe typical of the strategic issue which mr. Park mentioned So additionally the Semiconductor industry has expanded and deepened their global division of labor typical example is just If you have a for iPhone, there's a the semiconductor called the the logic which is mostly designed by American companies and Manufactured by Taiwanese called boundaries and of course using a lot of the materials coming from Japan and Korea and this Semiconductor is actually used by mass production process of iPhone or personal computer in China So it's a typical Globalization and now what happened is this United States is moving to cut China out of Semiconductor supply chain and in that in addition the US government is just preparing a huge subsidy To concentrate production basis in the United States So even for Japanese and probably South Korean Future requested to participate in this US centered supply chain It is not very easy to expand investment in China at this moment. So there seems to be a very typical the geopolitical movement of the system and Of course, the China is rushing to build a supply chain centered on its own countries That Does not depend on the United States so this is a part of the the Maybe de-globalization or different type of globalization But we are observing but if you look at the reality The I can't fight and many other industry of this Degree there is of course a lot of concern this kind of a political movement is spreading to other industries such as the EV electric vehicle motor vehicle or other Maybe super computer and so on so forth but so far It is very limited. So it is very important for us to watch how the scope of this kind of process is expanding to other industry or not and Also, we have to just admit in spite of this factor the quite a large amount of the industry is still Conducted under the so-called the fluttering of The global economy which mr. Thomas freedom said I mean So both United States and China depend on each other is quite a lot And so this is different type of the globalization The maybe I should say traditional type of globalization and question is whether we can continue this or not So let me just so discuss the two type of globalization and discuss Each item about different more carefully now for the first type of globalization important thing is in order for the economy The This is the advanced technology So deeper integration or the deeper partnership a deeper integration must be is not just simple trade It's a must be to deal with the strengthening the geopolitical effort of The to promote deeper integration such as the capital tie-ups government Involved support policies or technical corporations or the personal exchange So it is just beyond simple trading and there's a lot of the kind of a very intimate Collaboration is necessary now. This is even we can observe this kind of phenomena before U.S. China division was visible like takes a case of the free trade agreement or the The economic partnership agreement where there is some kind of a limited number of countries being involved in the global deepening now important thing is they the The question is whether we can just expand this kind of a partnership among the Limited number company to the larger number companies I mentioned Japan South Korea and the United States in my example of semiconductors but it is very important to include this The network the European countries Oceania companies Indian company and so forth and So let me just mention the one very famous word by professor Jagdis Baguatti or Columbia University What he said Let me just read If the Block economy stop at some point of time That can be a so-called a stumbling block for the globalization But if the block economy is expanding its scope increase increase number of companies that can be Become a building block for the globalization now reality is when we are thinking about the technology Complication and sophistication of the globalization this kind of the so-called the Deepening of the globalization among a few countries maybe a very good starting point and The important thing is we should just expand that that's kind of the globalization to increase number of the Countries so this is the one part of the globalization Let me say the second part of the globalization. I have to say this is a very large number of industry They're faced so-called the flattening of the world economy So the deserts still very large number of trade Dependence on each other's and the question is whether we can just continue this process so so for example the WTO is very important also WTO Is now very slow to progress the negotiation However, it is in increasing more important for each country to adhere to WTO the rules and there are many other very important the multilateral Scheme for the continuation of the flattening of the economy and let me finally just mention briefly about just the climate change Issues I'd like to particular emphasize the importance of co-effort on climate change. It is necessary of Course to address the issue of climate change with a participation of the old world's major countries But at the same time Participation of many countries on cooperative subjects will be important bill work to prevent the global warming from collapsing so the Discussing that kind of with the global issue with increasing number of the Countries is also the very important to just continue the process of the globalization. Thank you very much Hey, thank you very much indeed and thank you for putting the finger on technology and this Issue of the technological potential divide. Thank you very much John. You have the floor Thank you. Thank you very much and thank the organizers terrine the organizers for the opportunity to Attend this meeting and participate in such a distinguished panel The risk at this coming toward the end of a second broad panel on governance is to find that Everything has been said, but not everyone has said it So I'm going to limit myself to some broad points that I think are Important from a systemic point of view linked especially to the financial system and the linkage of the trade and financial systems and My principal conclusion unsurprisingly is that a more cooperative and coherent Multilateral approach to setting macroeconomic and financial sector policies will be required in order to achieve shared economic success and in my view whether such an approach is possible Will be a defining issue of the coming years and decades and in many ways what I'm suggesting is not an impossible Dream, but rather a return to the much more cooperative environment that Animated the response to the global financial crisis leading to the formation and early success of the G20 leaders process And I'm going to suggest three areas Specific in which will be either viewed as tests or opportunities for progress in the near term two will be familiar to you One will not It's important I think to remember that the post-World War two Bretton Wood system was intended to create a rules-based monetary system that was flexible both in terms of policy setting and that would quote from the articles of agreement facilitate the expansion and balance growth of international trade and Also would be flexible in terms of governance in which voting power in the newly created Multilateral institutions was to be based on members relative economic weight a measure that was to be reviewed at least every five years There are issues we could discuss on that, but it's and not wanting to sound defensive But at this time the top 10 voting members of the IMF are the G7 plus the bricks minus Canada So it's I think it would be hard to put deposit a replacement among that top 10 and Improve represent the representativeness of the or legitimacy of the institution That's not to say that what we have now is is either adequate or ideal But my point and my basic point here is that the shared intention of IMF members To boost global growth through expanding international trade Originally produced a parallel agreement to radically reduce barriers to cross-border international financial flows And so the current trends toward increased geopolitical friction and new trade protection Threatens also to disrupt the international financial system and to undercut the prospects for sustained global growth Now it's also worth remembering because the primary post World War two economic challenge was seen on Restoring the international trade system as well as the necessary financing channels No serious effort was made at that time to create a framework to govern cross-border capital flows After all such transactions hardly existed in the immediate post-war era But as we all know from the mid 90s mid 1990s to the onset of the global financial crisis in 2007 Gross international capital flows grew much more strongly than underlying international trade However, it was systemic flaws in the operation of global markets including poorly drawn perimeters of regulation and Inadequate supervisory oversight that contributed directly to the crisis and these ensuing great recession So recognition of these flaws among other systemic weaknesses Motivated the formation of the G20 leaders process and to the creation of the financial stability board in order to promote financial system resilience and reform Now 14 years after the first G20 leaders summit Progress has been made on enhancing banking sector stability through the cooperative work of the FSB However, the same cannot yet be said for capital market regulation in Broad terms the growth of new forms of non-bank financial intermediaries Suggest that both the perimeter and form of financial regulation needs renewed attention and There has been And that to me represents a test going forward can progress be made on reforming the regulation and in the very perimeter of regulation to encompass non-bank financial institutions in addition, there has been extremely limited progress toward establishing the G20's Common framework on debt treatment as a successor to the Paris Club Despite the imminent threat of a new wave of debt defaults among vulnerable emerging and developing economies and Most importantly the international political arena We all know and have already been discussed has become dominated by new geopolitical frictions At the same time these frictions have been reflected in measures that have resulted in new trade restrictions and new financial Sector sanctions and this is at a time when global growth is slowing and the risk of recession is rising so I Hope that it's I've made clear I've concluded that a renewed focus on a more cooperative and coherent approach towards setting macro and economic and financial Sector policy is needed to avoid creating new risks of protectionism and reduced Efficiency of international financial markets such negative developments inevitably would reduce potential growth and increase economic volatility Now two more specific tests looking forward or tests or opportunities that I would point to One as I've just alluded making the G20's common framework for debt treatment Perhaps with some modifications a success in providing needed debt restructuring is absolutely critical It's possible it will require a more cooperative approach, but without it Trouble is on our doorstep Second in the medium term an area that is almost Unknown and unmentioned the G20's framework for strong sustainable balance and inclusive growth Which is the principle albeit little known G20 forum for a green appropriate economic policies in a cooperative and coherent fashion Needs to be far more forceful and effective than is the case at present None of this is unimaginable all of it is possible And as I've said the FSB needs to make new progress toward more effective capital market rulemaking Now whether all this leads in the long run to new and effective forms of finance including the possible emergence of a Multipolar financial system should and will be decided by market forces in some since the desire to expand global trade on a Multilateral basis was the inspiration for strengthening the global payment system new trade protection and the proliferation of financial sanctions and other arbitrary barriers Threatens to undermine the economic foundations of the rule-based systems historic success in producing global economic growth Not to be too trite to end in the words of the great American Francophile Benjamin Franklin who told his colleagues drafting the US Constitution We must all hang together or most assuredly. We will hang separately. Thank you Thank you very very much indeed a job and again. I Take it that you are asking the world to continue to go in the direction of shared rules shared values in the economic front and You you seem to be quite confident that we can continue to proceed Which in a world which has never been that challenged is again a demonstration of confidence. Now, let me turn to Kaohi day you Hear the Chinese citizen We are very carefully listening to what you will say sir. Thank you chairman Thank you the organizer to having me here I guess there's no Consent on the definition of international economic order But it seems to me There should be three components in international economic order First of all, it's international organization economic organization or people say prison word institution IMF World Bank WTO Secondly, it's international Economic law and the regulation which is some involved with these Introducing some not just John mentioned like a Paris club some written some unwritten the last one is the international monetary system which mean which currency or which become the international currency standard I have a general judgment on the international economic order after the second war it's provide a good public goods play a positive role to Build up a base which word economy steadily grows in past several decades But at the same time It's show some shortcomings For example like John mentioned it the head and fully provide a benefit of global realization to developing countries And the other shortcomings so it's time for a reform How to do that? I want to describe a one by one for the each component of economic Order first of all for international economic organization. I also want to quote her John said More power in decision-making short more for shift to developing countries I guess for G20 Jeff sex suggests it should be G21 which including African Union should have a seat on G20 I think it's good idea for consideration Second for international economic regulation and the rule I guess show the stock To keep Some of them to keep it some of them we have to revise or some of Throughout the last one is add some new regulation along with the development of for technology advance Last for the international Monetary system after the collapse of 1917 bring them war Collapse the US dollar become the dominant reserve currency in Conceivable future. I don't think these pattern will have a fundamental change but from long term the multiple reserve currencies currency system More likely. I'm not going to say definitely will come out, but it's likely which will provide international liquidity more evenly to Different kind of countries People say that's will be three pillow system, which means us dollar You and the Chinese remain be I don't in short term. I guess Very important for us. I should do more macro Should do more cooperation on macro economic policy among other major economies also currently many Experiments for CBDC Under the framework of BIS there are four project to see whether they can unify some future of the CBDC, which I think it's good to facilitate transporter transportation and the payment system How the international Economic order involved in near future. I guess it will depend the results of two important factors First of all, it will depend on the results of geopolitical evolution if Russian and a Ukraine war what in the expanded to involve other countries or escalate to high level if the Friction and the competition between us and the China Wouldn't then escalate to conflict including military conflict. I still can't believe current framework for international economical order We will remain existing although as I mentioned it should be reform if not the whole word it word will be totally fragment and International economic order will complete a collapse the second factor is whether emerging Practicalism and anti-globalization Would be effectively content if not the global industry What a greatly disrupted and International economic order what they inevitably fall into in disorder. I just stopped here Thank you. Thank you very much indeed. What you say is extremely important your plea for having Reserving if I may appropriate order renewed order and fight against the De-globalization anti-globalization phenomenon that is looming in the present world is very very important. I Resolve the right to come back to the international monetary system that you mentioned very wisely I turn now to Monsieur veron. You have the floor my dear, please Thank you very much and a particular thanks to the world policy conference and a speciality and some name for including me It's a particular privilege for me to be in this panel under the chairmanship of Jean-Claude Trichet Who is also the honorary chairman of Bruegel you mentioned my affiliation there Jean-Claude I also want to apologize for being another male panelist in an old male panel And I'm conscious of participating in the clearly suboptimal outcome here, but here we are The question is the is the international economic order collapsing and I will Again give a given other Attempt to answer this and and the answer is no there is every reason to be concerned these days I think we all have them in mind and they have been Analyzed already by a number of participants There is a massive uncertainty. I think this is a dominant Characteristic of the current moments that we don't know a number of fundamental things even in the very short term And what happened in China in the last few weeks was a reminder of that There are some very basic Premises of how we look at the world that we cannot be completely sure of And of course climate change is a massive challenge. We're Losing the race against time in addressing it. So I'm not advocating complacency here. Let me be very clear, but We don't see a collapse in sight of the order. I think the international economic order actually is surprisingly resilient What happened this year? I was at the world policy conference last year I was privileged to be also here in Abu Dhabi at the other side of town And since then extraordinary events have have been happening Russia has invaded Ukraine The consequence has been Russia being isolated in the international system and to a large extent taken out of it so Ring sense from the international economic system as opposed to this conflict leading to a collapse of the system I think nobody puts what the gist of what happened more eloquently Than actually two days before the invasion as a Kenyan ambassador to the United Nations Martin Kimani Who has probably many of you remember? Made that point that what Russia was at the time Threatening to do the invasion of Ukraine was an absolutely fundamental challenge to all the norms that bind us together on this planet and So the response in terms of international economic institutions has been forceful But I would say proportionate in terms of the extraordinary violation of norms that we have seen and an extraordinarily forceful response So let's look at what I mean by resilience very quickly The WTO mr. Pogam reminded us that it's still there and running even after the aggression of the Trump administration As a G20 we had To my mind a very successful summit in Bali which kind of illustrates what I'm talking about including some strong wording In the final declaration compared to what I think everybody was Expecting and I think the Indonesian presidency of the G20 This serves a lot of credit for that The Bretton Woods institutions John Lebsky reminded us of the challenges and the need for the common framework To make progress that's we're getting a lit little bit into the weeds here But but I think if you look at for example the restructuring of the announce restructuring of the debt of Zambia We see a possibility of some constructive Evolutions especially in the main challenge to the IMF these days which is an interplay between Chinese Lending to a number of Developing and emerging countries and the traditional framework embodied by the Paris club So I'm not saying the problem is resolved here. I'm just saying that the worst case scenarios are not materializing The World Bank it has been mentioned by somebody in the audience is still led by Somebody who has taken positions close to climate in climate sense denial, but it remains a strong institutions Let's talk about finance because that's the area I specialize in most the Basel three accord on banking capital requirements leverage liquidity and stress testing has been an extraordinary international success it's being Implemented in a more globally consistent ways and the previous accord of Basel to Sadly the European Union is still not compliant But most other Jurisdictions are and I think that has led to great resilience In the financial system in the banking system as we have seen with the COVID-19 shock and with the shock of the Ukrainian war the bank for international settlements has Echoing what I was saying about the violation by Russia of international norms for the first time that I'm aware of Applied international sanctions on Russia one of its members one of the members also of the financial stability board Showing the effectiveness of Collective discipline in the system. I would argue I'm not aware that the BIS had ever participated in international sanctions before with the possible exception of freezing the assets of the central bank of Yugoslavia, but that was after Yugoslavia no longer existed We also have seen that Challenges to the international economic and financial orders have not been very successful. I'm not going to expand on crypto these days We don't see either from Russia or China for in very different environments attempts to We don't see successful attempts to replace the basic infrastructure of the global financial system payments messaging swift as a International transaction settlement through CLS group and infrastructures of the same nature and finally as Gabrielle has mentioned we even have unprecedented progress and finished of course In an area which until now have been completely immune to that kind of collective cooperation Which is taxation with the efforts of the OECD Unfinished business to say the least, but the fact that this has even been possible to initiate I think has to be taken as a step forward that has happened under difficult circumstances and of course the EU the European Union which I come from and which is the most advanced exercise in supranational economic and political cooperation Has been built on rejection of economic nationalism with coal and steel in the first place Well, it has faced an existential crisis, but it has overcome it. Certainly. It has lost an important member So United Kingdom, but on many Parameters, it's now stronger Than ever and we've seen that with the next generation EU a program of borrowing and spending Which is the first time on the scale that the EU has been able to finance itself on its own At the European level with redistribution against among its countries So as I said no complacency we need We don't need to replace the system and I think that it goes with what Chao Yi They just said China is not asking for the replacement of the system. It's asking rightly for its reform and transformation I'm talking about the official discourse of China here One thing I will say there have been many ideas already put forward for Reform and I'm not going to repeat things that have already been said I will just say as an European I think Europeans have to be proactive in creating space for other Jurisdictions in a changing world maybe echoing what I mean that that Torrey was saying in the first panel When you look at the things I focus most on the BIS the Basel committee is a financial stability board Europeans are clearly massively over represented in that infrastructure There's absolutely no reason that in the Basel committee you would have seven individual countries of the euro's Represented individually together with the ECB so that has to change Europeans need to take the initiative and Provide a for more balanced Representation particularly of East Asia, but also of the Middle East Africa and Latin America. Let me conclude on that Thank you. Thank you very much for this strongly for the European to be less numerous But as influential as they are but less numerous in many of these Groupings, so thank you very very much. I have to say that times is elapsing quite rapidly. I understand that we have to Leave the room at 1130. Am I right to say that I'm asking the organizers If it will it is the case that we have to leave the room at 1130 Then I would go directly to the audience if you permit unless one of us wants to make a point and Contradict Violently what has been said by another panelist, but I don't see that you are asking for such a Coral if I may among not a good coral I mean this kind of debate that we we like very much, but I turn then to the audience and I see one hand Raised over there and over there and over there, so please The mic is there and then You you will have the flow afterwards madam immediately after please Thank you. Mr. Trichet. It's Steve R. Langer New York Times Very good panel just given time. I want to ask given the sanctions on the Russian Federation because of the Ukraine war What lessons mr. Chow and others is China drawing from these sanctions and how can it Alter the current system to avoid that kind of pressure in the future. Thank you Thank you very much. Perhaps we will have another question and then we go to the panel madam Well, he would say that this is not going to be the last crisis But let's be careful because some crisis led to worldwide catastrophe So I think you know, let's be aware of that. But my point was about Women This panel doesn't reflect the contribution of women into the global economy Obviously, although we have to improve Their presence but a very interesting report of the IMS is saying that If you have more than 40% of women in the global economy If we increase it the United States would have a boost of 5% of GDP In Egypt, it would be 34% of the GDP in Africa. It would be even more So don't you think that we need to change the pattern? you know of this, you know global economy we're talking about and and make it more gender sensitive as you're sitting here, I don't think you reflect what the how much we work as women in the world Thank you very much for this remark. I was expecting I upload I think that none of us is responsible for the composition of the panel to be frank But you you you made the point very good. Please last question and then we turn to the panel. Thank you To two brief questions One is it seems that most panelists have commented on the international aspects of the international economic order But there are domestic dimensions to it as well. They're a domestic Foundation for the international economic order So maybe the international economic order is not collapsing But the domestic dimensions are increasingly at odds with what the international economic order implies And it was mentioned in the first panel that there were difficulties within the society themselves So how do you address that that issue and so gone? Mr. Felbermeyer Started by seeing that the international order is not collapsing that it had shown a lot of resilience So it has adapted but then he identified a number of challenges that may lead to a question about the virtue of adaptation Because this adaptation has come through a succession of crisis and this crisis are increasingly frequent and increasingly costly So is this a model that we want or do we need a recreation of this international economic order? So I stopped there. Thank you. Thank you very much indeed I think that we could start responding to the first three questions. Who wants to take the floor immediately? Yes, okay Because I'm only Chinese independence. So it's naturally for me to answer the question regarding the How China can learn some experience from Russia Ukraine war I guess the question have many implications behind the question itself First of all, probably I have to point out the Chinese government official position is along with India Indonesia, South Africa, many developing countries, which is They don't support the Russian invasion to Ukraine They think it's violated the principle of the United Nations But at the same time they're not necessary support US and Western countries to have a section against Russia from many different Perspective because in China The government official will think that way even we support us sanctioned Russia But US still will keep pressure Regarding China as a major rival why I should do that That that's my interpretation second implication I guess I understand many Coverage of media always Link between Russia-Ukrainian relation and mainland China and Taiwan I recall several years ago also here in panel I That time I point out because many people point out to me how about South China Sea conflict with Crimea that time because 2014 Russian took over Crimea so many people make a comparison at that time I say I don't think it's the right to make such kind of comparison. Why because the Crimea is very clear Is at least in past several decades? It's international recognize the part of Ukraine South China Sea island not is just some No people living island some country claim belong to them. I guess that's difference very important By the same thing same line of thinking I don't think it is the right make comparison directly between mainland China and Taiwan and Russia and Ukraine Because internationally Recognize Taiwan province is a part of China many international Treaty recognized having say that doesn't mean I Advocate or I support Chinese gum the short take a military action against Taiwan I'm not but the sensitive here if someone Want to push Taiwan to extreme as the independence Nothing can be happen That's my answer. That's very very clear. I have to say thank you very much indeed for what you just said Which takes every issue? Directly and without I would say too much complication your direct clear Thank you very much indeed. I have to turn to Tai Oh. Yes Yeah, please I want to respond to the question on domestic policy environment regarding Globalization on trade definitely more and more people ordinary people think Globalization and trade in a negative way because simple because they think that they lose their job because their own companies are leaving Their countries and invest in other countries or they are importing too much so that you know domestic production is being decreased So yeah, I'm a professor for international trade for 30 years I'm persuading my student and teaching my student. That's not correct You know, there are other reasons to cause this kind of thing and income equalization income in equalization but people's you know perception is going that way and wisely the politicians are using that kind of sentiment to produce more Protectionist measures. So what I'm saying is here preaching or persuading the people who are having difficulties in their own economy is not enough I think we have to find out some solutions policy measures We have a so-called inclusive trade policy measures. It sounds very nice, but no no substantial Content in it. So we have to find out something to really Substantially help those people who are having difficulties from many other reasons. This is my comment on that very clear very clear Yeah, thank you. I'd like to reply to miss history very very quickly I think you brought up a very good point about diversity equality of opportunity I think you need incentive and more efficient public policies incentives are there. That's a good news I think the business community is realizing that it's good for their bottom line. So you gave a set of stats There's a different study that shows that if you increase black American participation in the US economy You can also generate about 5% of increased GDP. That's about 1,000 billion dollars every year That's fantastic. And the business community is already realizing that so It's there right in terms of public policies. You have the national level and then you have the International level and I just want to mention one Specific program that the EU put together during COVID which I think was very good It stands for sure and it's the temporary support to mitigate unemployment risk in an emergency Which is basically a second pillar on top of national unemployment systems to basically provide some Solidarity and make the system more resilient and and provide ultimately more equality of opportunity Thank you very much. Yeah, indeed. And again Madam we all agree on the fact that this is not a normal composition of the panel and We have no responsibility in that but the message is loud and clear and thank you very very much indeed Mr. Ito you have yeah, I have a just the response to the final question about the adaptation of the globalization process from the picture of the Tom Friedman Now when we are thinking about the process of globalization, there's at least four Or maybe more different trend one is multilateral approach. The second is a regional type of approach and third is the bilateral to country negotiation approach and maybe force is unilateral action where each own country can just move Naturally and the actual process of the globalization just combination of the four and sometimes maybe multilateral approach Is just moving very quickly, but sometimes It's material approach is thumbing then we need a more effort on the regional effort or maybe better effort and probably because of the geopolitical issues and other issues just we discussed the trend is a little bit changing from just a multilateral approach to the more realistic regional or bilateral, but I'm not sure whether this is just the Containing or maybe we need more effort to just strengthen the multilateral approach to the globalization. Thank you Thank you very much indeed Do we have other remarks or questions answer to questions if I may we had the International monetary system that you you mentioned And I would only say in this domain Clearly the moment the renminbi becomes a full convertible currency I'm speaking of the control of John. We are changing the international monetary system At the present moment the renminbi is in the basket of the SDR as the one of the five and And of course it was a major major move a major change. Now. It does not I would say a line with the functioning of the system today, but again as soon as the renminbi is convertible full convertible currency You change the system and let me whilst I'm mentioning the SDR and and the international monetary system There has been a consequence of the last big crisis of Lehman brother Which is not sufficiently underlined in my opinion after Lehman brother crisis after the great financial crisis all central banks of The advanced economies that are in the basket of the SDR the four namely the yen the sterling the dollar and the euro Decided all of them not because there was an agreement or a negotiation But because it was their own sentiment that it would better anchor The expectations they all have the same definition of price stability Namely 2% around 2% in the medium term it is the definition of price stability in Japan in the US in Europe in the UK and I have to say that China itself is not far from the 2% So all that taken into account it seems to me that it is a silver lining in the global system Because before we had no joint definition or agreed Nationally, but converging internationally definition of price stability. It's been reaffirmed by all countries concerns central bank concerned heads of central bank concern in the US in Europe in the rest of the world and Again, I take it that it is something which is in a very difficult world in a very hectic world Very complicated full of challenges It is one of the silver lining that we might have another silver lining But it was mentioned by many is that the G20 continues to work and continues to I would say give the appropriate political backing for a number of things that are very important John mentioned that and all speakers mentioned mentioned that and I take it also that on the environment front In a world which is again so divided the fact that we created a new international sustainable standard board in Glasgow and Confirmed in the recent Egyptian cup. So it's extremely important We all agreed that we were on planet Earth that it was our spaceship and we had to care for our spaceship and It was not obvious that we would have a consensus on this new international board, but we we had it so I Think that I am called to interrupt now the panel that is it is what is written in the program So let's respect the program and let's thank you very very much indeed