A session titled "Braving the Headwinds: Rewiring Growth Amid Fragility" is held during the World Economic Forum's 14th Annual Meeting of the New Champions in Tianjin, China, June 27, 2023. [Photo courtesy of the World Economic Forum]

The World Economic Forum's 14th Annual Meeting of the New Champions, also known as "Summer Davos," commenced on Tuesday in Tianjin, China. Top economic and political leaders gathered to discuss fostering economic growth amid various global challenges during a session titled "Braving the Headwinds: Rewiring Growth Amid Fragility."

Borge Brende, president of the World Economic Forum, emphasized the importance of reviving growth through cooperation and trade. "We will have to make sure that we are not moving into a lost decade," Brende said.

"Trade used to grow around 6% per year. Now it's growing 2%. If we introduce new tariffs and a 'beggar thy neighbor' approach, instead of 'prosper your neighbor' approach, we will not get back on a sustainable growth trajectory." Brende also referenced a recent IMF report, warning that a decoupling situation could shave off 7% of global GDP, likening it to a depression.

New Zealand Prime Minister Chris Hipkins highlighted the green transition of his country's economy as a growth opportunity. "Consumers are increasingly looking for products that are clean and green," he said. "For our exporters, being able to market internationally as a clean green brand is vitally important. But we also have to make sure we're backing that up by ensuring that what we produce actually is produced in a way that's clean, green and sustainable."

Prime Minister Pham Minh Chinh of Vietnam called for global solidarity and multilateralism. "When we take a global approach, we need to have global solidarity and uphold multilateralism," he said, stressing the need to recover business, manufacturing and production soon.

Zhang Yuzhuo, chairman of China's State-owned Assets Supervision and Administration Commission, shared his view of China's economic recovery. He acknowledged that China's strong economic recovery has been a source of confidence for the global economy. This is particularly significant given the backdrop of multiple global challenges that have been impacting economies worldwide.

Zhang highlighted that China has maintained a positive momentum of economic recovery, with 4.5% GDP growth in Q1. He also suggested that the growth is on a steady path of recovery, with expectations that Q2 will be better than Q1. This optimism is supported by estimates from major international organizations such as the World Bank, OECD and IMF.

However, Zhang also emphasized the need for sober awareness of the challenges that lie ahead. He pointed out that the growth in foreign trade was below expectations, with modest growth in the first five months due to multiple factors. Zhang also stressed the need to create new growth points for consumption.

Ngozi Okonjo-Iweala, director-general of the World Trade Organization (WTO), warned against the world decoupling or fragmenting. "Decoupling and fragmentation is something that the world simply cannot afford to have," Okonjo-Iweala said.

She cited research conducted by the WTO a year and a half ago, which showed that a decoupling into two trading blocks could result in a 5% loss in global GDP in the long term.  

"That's like saying that we lose the whole equivalent of the whole economy of Japan, which would be catastrophic for the world," she said. Her comments underscored the severe consequences of decoupling and the importance of collaboration.

Barbados Prime Minister Mia Amor Mottley echoed the opinion, emphasizing the need for global cooperation. "If ever there was a time for the public and private sector to work hand in glove, it is now," Mottley said. "And if there was ever a time for the North and South, East and West to work together, it is now. We cannot take another crisis, and decoupling presents that risk."

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