Global economy is undergoing a structural change, accompanied by a series of turning points: Zhu Min

Updated 2017-04-27 10:31:16 Global Times

The current world economic structure is mainly characterized by low growth rates in the economy, investment and trade, as well as low oil prices, interest rates and inflation. Against such a backdrop, a series of problems have emerged, such as aging societies and an imbalance in wealth distribution.

Many countries around the world are facing the aging society problem, with rapid changes seen in the global labor structure. This year, the global population is around 7.5 billion, and we estimate it will reach 11.2 billion by 2020. The peak of labor supply in developed and emerging countries was in 2008, while the peak in Southern Africa is expected to come around 2070. So who will be responsible for the education of young workers in Africa, and what impact could African immigrants bring to the world?

Meanwhile, the imbalance of global income distribution has got worse. At present, 10 percent of the rich own 40 percent of the world's total revenue, similar to the level before World War II. This is a level that could lead to a crisis.

There is also the rise of populism, in countries including the UK, the US, Italy, France, Spain and the Netherlands. This could be seen as heralding a turning point in global politics toward instability.

The election of Donald Trump as US president has added to the uncertainties facing the world economy. The US is tightening its monetary policy by raising interest rates, while at the same time attracting capital flows back to the US to increase employment by strengthening its currency, and this is expected to have a considerable impact on the global economy.

Trump's economic policy is the world's largest uncertainty today. While retaining a slow growth rate on the whole, the global economy is undergoing a structural change, accompanied by a series of turning points in terms of economics and politics. Political risks, and interest rate and exchange rate risks have become the main sources of uncertainty, and further volatility is inevitable.

Zhu Min, former deputy managing director of the IMF, speaking at the 2017 China Green Companies Summit.

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