2020 In Perspective

Recently IMF Managing Director Kristalina Georgieva gave a stunning speech at the 11th Caixin Summit in Beijing where she summed up where the world has been in 2020 and where we’re heading in the months and year ahead. This put 2020 in perspective particularly in the context of the summit’s theme of rebuilding global trust after the pandemic.

We thought it was important to bring you Georgieva’s remarks.

2020 will go down in history as the year when the world faced its biggest challenge since the Second World War and deepest recession since the Great Depression.

Because of the decisive action of governments and central banks, we managed to put a floor under the world economy. And we are seeing the green shoots of recovery.

But the road ahead is going to be difficult.

Coming out of this recession will require, domestically and globally, determined collective action. This is what I want to focus on in my address to you today.

What should be the priorities for the global community as we step into 2021?

How can we make it a year not only of economic recovery but of economic transformation?

How can we achieve a world on the other side of the pandemic that is greener, smarter, and more inclusive?

Let me start with priority number one: to defeat the virus, defeat it everywhere.

We cannot possibly achieve a sustainable recovery unless we have a durable exit from the health crisis.

That means taking action to protect people from the virus while it is still with us – and most importantly taking action to have vaccines and treatment and make sure that they are available everywhere. This crisis teaches us that we are only as strong as our weakest link.

For this reason, I want to welcome what China has done to combat the virus so far.

As a result of very determined domestic measures, the Chinese economy is going to be one of the very few that will finish 2020 with positive economic growth. We project 1.9% growth for this year and 8.2% for next year.

China has also made a commitment, as it comes up with vaccines and treatments, to make them global public goods. And it has joined others to make sure that we can accelerate the delivery of vaccines to all people, everywhere.

And I am encouraged to see that there are good indications that vaccines are going to be available for 2021.

Second, we must be determined to underpin the road to recovery with continuous strong policy actions.

Our main message here is: do not withdraw fiscal policy support and monetary policy support prematurely . China has been strong in early actions — and also in continuing these actions until we see the health crisis in the rearview mirror.

Also, China has recognized that while this crisis hits everybody, it is low-income countries that are suffering the most.

I want to express our gratitude from the IMF for China’s contribution to our concessional lending capacity. As a result of it 47 of the 81 countries that have benefited from financial support from the IMF are low-income countries who are benefiting from concessional finance. China also joined us in extending debt relief to our 29 poorest members.

It is very important that we move forward with that same determination to help low-income countries.

And in that regard, the G-20 Debt Service Suspension Initiative that China joined remains very important. I urge all creditors everywhere to embrace this initiative.

I also look forward to the Common Framework for debt resolution that the G-20 is working on, and I look forward to engaging with China as we find solutions to countries that are suffering under the burden of debt. Debt restructuring in some cases is a necessity.

As we look forward, it is very critical to zero on our third priority: make sure that actions we take to support the recovery are oriented not to reproducing the economy of yesterday but shaping the economy of tomorrow.

What this means is that the necessary public investments that are going to be put in place in the months and years ahead should pursue, first, investment in people to make sure that people are resilient – education, health, social protection.

Second, investment in green infrastructure – making sure that we can build a low-carbon, climate-resilient economy for tomorrow. And I want to welcome China’s commitment to go carbon-neutral by 2060. So important for China — and for the rest of the world!

And we also have to make sure that the digital transformation we have seen happening at an accelerated pace benefits everybody – that people in countries with more or less financial capabilities can be connected so we can see inequalities that have been a problem in the past being tackled on the basis of equal access to the opportunities of tomorrow.

Finally, we know that the engine of growth that we have benefited from for many decades, trade, remains important.

And in many countries there is a sense that some benefit from global trade, while others see their jobs evaporating as a result. That focus on making sure trade works for everyone ought to be a priority for everybody, and I do believe that China will play its important role in this regard.

Let me finish by wishing you very successful discussions – and for all of us to see 2021 be the year of transformation that brings us to a better world, for us, but most importantly for our children and our grandchildren. Xie xie.