Xi aims to defend China's economic stability at G20

President Xi Jinping is expected to reassure the Group of 20 nations in St. Petersburg that China's economic growth is stable and sustainable, said Angel Gurria, secretary-general of the Organisation for Economic Co-operation and Development.

Xi is slated to inform the two-day G20 summit, which will end on Friday, that China's economy will continue to grow despite several thorny issues, such as a turbulent housing sector, the nation's push for urbanization and problems in its credit and investment-driven growth model, Gurria told China Daily in a recent interview.

He said the most important thing for Beijing's policymakers is the nation's transition from an export-driven growth model to a more balanced one where domestic consumption plays a greater role.

China's economy grew by 7.5 percent in the second quarter, the 10th consecutive quarter that the growth rate has declined. It is the nation's longest streak of economic decline since it adopted market reforms more than 30 years ago.

The slowdown has sparked concerns that China is likely to miss its official growth target of 7.5 percent for the year, and some economists have predicted that growth might drop to as low as 6 percent.

Gurria, however, offered a brighter outlook.

"Even if China's growth goes down to 7 percent, it is still an admirable and dynamic level of growth while the rest of the world has flat or zero growth," he said.

In November, China's senior political leaders and Party members will meet during the Third Plenary Session of the 18th CPC Central Committee to discuss the country's reform agenda.

The much-anticipated meeting will map out the country's economic policies and reform plans under the new leadership.

"The discussions being held by the political bureau and the ministers over the preparations that are being made and the policy decisions to be taken have been quite explicit. So we are very reassured," Gurria said.

While growth, unemployment and trade issues will be among the main priorities of the G20 summit, Gurria said recent changes to fiscal and monetary policies of developed countries and the possible repercussions from these changes should also be discussed and debated during the summit.

“The aggressive monetary policies of the US and Japan have produced low interest rates and have helped (the global economic) recovery. But the new reality is that capital is coming out of the big countries, causing instability and volatility in currencies and financial markets of developing economies,” he said.

The most recent example is the sharp decline in India's rupee, which dropped 20 percent in value against the US dollar this year amid concerns that the Indian economy is weakening and as the US prepares to scale back its massive quantitative easing measures.

"The issue was heavily discussed during the G20 meeting of finance ministers in Moscow in July and it will continue to be one of the topics that dominate the St. Petersburg meeting," Gurria said. "I think President Xi is going to arrive at the meeting and talk about the work that China has been doing in order to support the common endeavor of the G20."