(Economic Observation) The global economy is struggling to recover, the head of the financial giant warns of risks

　　China News Service, Shanghai, October 23 (Reporter Wang Enbo) After experiencing the impact of the epidemic, the global economy is striving to get rid of the quagmire of recession and strive to achieve recovery.

At the 3rd Bund Finance Summit held in Shanghai on the 23rd, the heads of many global financial giants reminded that although the economy has rebounded, the risks have not yet dissipated.

　　The latest "World Economic Outlook Report" released by the International Monetary Fund shows that the global economy is expected to continue to recover in 2021 but the momentum is slowing down. The annual growth rate is expected to be 5.9%, which is 0.1 percentage point lower than the July forecast.

　　According to Peng Chun, chairman of China's sovereign wealth fund-China Investment Corporation, since the beginning of this year, with the continuous promotion of vaccination, countries have gradually loosened control and resumed work and production by industry and by stages. Strong recovery of growth.

However, this recovery is only a rebound on a low base. In fact, many countries have not yet reached the output scale at the end of 2019, and the road to economic recovery is still long.

　　A major support for the current global economic recovery is that many economies have launched large-scale fiscal and monetary stimulus policies since last year to hedge against the impact of the epidemic.

But in the eyes of the person in charge of the participating financial institutions, this move is a "double-edged sword."

　　Daniel Pinto, co-president and chief operating officer of JP Morgan Chase, pointed out that relevant measures have indeed allowed all parties to embark on a path of recovery in the current economic recession and epidemic risk environment, but in the medium term, various stimulus policies will encourage people to take more risks. To increase sustained spending on housing and investment.

Over time, the contradiction between the buyer policy that supports growth and the need to control inflation must be resolved.

　　Goldman Sachs Group President and Chief Operating Officer John Waldron also bluntly stated that as the world gradually enters the "post-epidemic era", the world will face heavier government debt after trillions of dollars are released from global stimulus measures. problem.

He gave a set of numerical comparisons as an example: the current global government debt is expected to account for 97.8% of the world's GDP in 2021, while the figure is 83.6% in 2019.

　　Rui Dalio, the founder and chairman of American Bridgewater Investments, observed that there is a phenomenon that governments of various countries—especially the U.S. government—when interest rates reach 0% are unable to support their own expenditures and debts due to lack of funds. Repayment, which led to a sharp increase in the scale of debt, a large increase in currency issuance, and a rapid rise in taxes.

"Historically, similar things are usually a prelude to financial crises."

　　The heads of various financial institutions generally believe that despite the rebound of the global economy, growth is still unstable, endogenous power still needs to be strengthened, and uncertainties are still prominent.

In this context, how to manage risks and deal with challenges?

　　Peng Chun believes that all parties should strengthen international policy coordination and jointly face potential risks.

In the field of public health such as the prevention and control of the epidemic, the world must watch for help and cooperate with each other. It is impossible to trace the origin of the epidemic and politicize the distribution of vaccines. It is necessary to increase the international sharing of the new crown vaccine to increase the availability of vaccines in developing countries.

In the field of macro policy, it is necessary to strengthen international policy coordination and joint collaboration.

　　He also reminded that the current central banks of some major countries are planning to reduce the scale of asset purchases, which may have a huge impact on the economy and capital markets.

Major countries should increase transparency in the timing, magnitude, and policies of monetary policy withdrawal.

Countries should strengthen the communication between policies and financial supervision and reduce the negative spillover of policies.

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