China's critical opportunity at Davos

The annual meeting of the World Economic Forum (WEF), which is starting this week in Davos, is creating significant expectations. In the past, WEF meetings have identified, with remarkable weight and clarity, both the fundamental problems of the world and the urgent tasks of our time. This has helped policymakers in designing their decisions. The speech of China’s Vice-President Wang Qishan, scheduled Wednesday, Jan 23, is eagerly awaited.

Davos is a place where global leaders send key messages to the world. Two years ago President Xi Jinping took the rostrum in Davos to make a powerful case for multilateralism as the key instrument for addressing both the most urgent and the most important issues of our era. This year the same message should be strengthened and developed further. The context is appropriate: The discussions at the 2019 meeting of the World Economic Forum will be placed within the framework of “Globalization 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution.” It is understood that the role of China will be critically important for the global architecture of the future.

Building a new global architecture is an urgent task. In the past months China has consistently offered further opening-up of its economic space as its contribution to building a new global economic architecture. This offer was clearly stated by President Xi at the Boao Economic forum in April and at the First China International Expo in Shanghai in November. The president offered further opening of the Chinese markets for goods, an improved investment climate for foreign investors, and more opening of the services sector, including in such areas as telecommunications, education and medical services. He made special emphasis on the preparedness of China to significantly improve protection of intellectual property and cooperation in science and technology. Moreover, China and the EU have already started to prepare proposals for the improvement of international rules for cooperation in the field of technology policy, state subsidies and other critical issues for the international trading system. These are important elements for a new global architecture that deserve not only to be noticed but also to be given strong support at Davos.

But there is another element that must be equally recognized and supported. The participants of the G20 summit held in December in Buenos Aires reached consensus about the need to make a major step toward reform of the World Trade Organization at the group’s next meeting later this year in Osaka, Japan. This is an immediate and urgent task. The global business community has much to gain from timely reform which would include arrangements in such areas as protection of intellectual property, cooperation in technology and state subsidies. Support of the global business community gathered in Davos would be highly welcome.

Moreover, this support has to be exercised with a good understanding of the nature of the task at hand. Reform of the WTO cannot be approached as a predominantly technical task that can be left to specialized diplomats. To the contrary, specific technical aspects represent smaller parts. The problem is in essence political, and strong political leadership is required in the effort to find adequate solutions. Meaningful progress for reforming the WTO in 2019 can only come about with the strong leadership of China, EU, US and Japan – and of the other key players in the WTO. This is a tall order that merits high priority by the policymakers and the support of the global business community gathered in Davos.

In defining their priorities, decision-makers should distinguish between urgent and important issues. Leaders become great when they make sure that when dealing with urgent tasks of the day, they do so in a manner which helps finding solutions that will define the future. Managing trade relations and reform of the WTO is an urgent task. However, it does not represent an end in itself. If addressed successfully, it will enable the international system to avoid a debilitating trade war and, at the same time, lay foundations to address a host of fundamental, long-term issues of our time. These issues include those brought by the fourth industrial revolution as well as the existential problems posed by global warming. International trade, investment and technological cooperation can go a long way toward finding solutions. This year’s Davos meeting is an opportunity for China to make a strong case for such a development and to gain support from the global business community.

Danilo Türk was president of the Republic of Slovenia from 2007 to 2012. He is currently a nonresident senior fellow at the Chongyang Institute for Financial Studies at Renmin University of China.

The opinions expressed here are those of the writer and do not represent the views of China Daily and China Daily website.