About one year after the financial crisis began to affect the whole world, signs of economic recovery have emerged in certain developing countries although they still face various great difficulties in mitigating the unexpected impact of the crisis.
Mahmoud Mohieldin, Minister of Investment of Egypt, said at the ongoing Summer Davos forum in Dalian, northeast China’s Liaoning Province, that his country had seen a drop of 20 percent to 25 percent in foreign direct investment (FDI) in its most difficult period compared with the average of the past five years.
But the country has shown signs of economic growth recovery such as the increase of FDI in the past few months, according to the Egyptian investment official.
Lim Guan Eng, chief minister of Penang, Malaysia, said the global financial crisis affected a lot the country’s economy which relies much on exports and thus made it necessary to reform.
The chief minister said his country was considering other modes of growth, such as that of the tourism industry, to help revive its economy.
At the three-day Summer Davos forum, or the annual meeting of the “New Champions 2009”, “to relaunch growth” became the theme of discussion among 1,400 participants including business leaders and officials from more than 80 countries and regions worldwide.
In particular, the role in global recovery of the developing countries, the victims of the crisis, was widely discussed.
The global crisis led to a sharp increase of unemployment, a fall in trade and prices of exported commodities in developing countries, said Sha Zukang, UN Under-Secretary-General for Economic and Social Affairs, at the forum.
The developed countries should help expand the market of the developing countries and avoid debt risks for them, he said.
Zhang Xiaoqiang, vice minister of China’s National Development and Reform Commission, said the developing countries should give full play to their own advantages to reduce the unfavorable effects of the downtown.
“Of course, cooperation in trade, technology and investment should be strengthened between China and other developing countries, and between the developed and developing nations, to combat the slowdown,” he suggested.
The developed countries should also increase their official aid to the developing countries and support the latter’s social and economic development, he added.
The U N, the World Bank and the International Monetary Fund should also do more in dealing with the poverty problems and help realize the UN millennium development goals, according to the official.
After the crisis, many countries had taken stimulus measures to spur their economy. But analysts worry the measures are likely to cause inflation if not properly handled.
Role of China in Global Economy
As the largest developing country, the performance and role of China in world economy was much discussed as the country’s economic growth has been in a period of stabilization and recovery.
“We have arrested the downturn in economic growth. In the first half of this year, China's GDP grew by 7.1 percent, investment expanded at a faster pace, and consumption maintained fast and steady growth,” Chinese Premier Wen Jiabao said in his speech at the opening ceremony of the Summer Davos on Thursday.
“China's stimulus package focuses on expanding domestic demand and is aimed at driving economic growth through both consumption and investment,” said the premier.
In response to some views that China will be a major driver of the world economy, Zhang Xiaoqiang said China still had a long way to go in terms of driving the world economy.
Zhao Xiaoyu, vice president of the Asian Development Bank, said it was impossible for a single country to be the driving force of the world economic growth.
But it is a fact that emerging countries such as China are playing a more and more important role in the world economy, Zhao said.
(Xinhua News Agency September 12, 2009)