{
  "title": "Advancing China’s Sustainable Economic Growth",
  "publication": "IMF News, March 24, 2024",
  "sourceUrl": "https://www.imf.org/en/news/articles/2024/03/24/sp032424-md-cdf-remarks",
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  "summary": "Remarks by the Managing Director Kristalina Georgieva at the China Development Forum, March 24, 2024, Beijing",
  "publishDate": "2024-03-24",
  "sections": [
    {
      "heading": "The global economy",
      "content": "- The year ahead will require careful calibration of monetary and fiscal policies to secure a soft landing — bringing inflation down while maintaining growth firmly in positive territory.\n- Central banks must decide when to cut interest rates and by how much, based on data, because the pace of disinflation and growth are diverging across countries.\n- Fiscal authorities need to embrace consolidation to reduce debt and rebuild buffers, while financing digital and green transformations.\n- The global economy has proven remarkably resilient due to strong macroeconomic fundamentals, robust consumer and government spending, held-up labor markets, and normalized supply chains.\n- Projections and medium-term outlook:\n  - “We project over 3 percent growth this year and next.”\n  - “Looking to the medium term, we expect global growth to be around 3 percent.”\n  - Pre-COVID decade annual average: “3.8 percent.”\n- Structural challenges: low productivity growth, high debt levels (especially for emerging and developing economies), and geopolitical tensions affecting trade and capital flows.\n- Opportunities: digital and green transformations can boost productivity growth and living standards; deep structural reforms can enhance entrepreneurship, innovation, and economic performance.\n- Regional note: In Asia inflation rose less and is coming down faster, so interest rates have not risen as much."
    },
    {
      "heading": "China — a new era of high-quality growth",
      "content": "- Recent performance:\n  - China saw a “strong post-Covid rebound in 2023, with growth exceeding five percent.”\n- Medium-term role:\n  - China will continue to be a key contributor to global economic growth despite headwinds from low productivity growth and an aging population.\n- Reform potential and quantitative scenario:\n  - “With a comprehensive package of pro-market reforms, China could grow considerably faster than a status quo scenario.”\n  - That additional growth would amount to “a 20 percent expansion of the real economy over the next 15 years—in today’s terms, that is like adding US$ 3.5 trillion to the Chinese economy.”\n- Core ingredients for high-quality growth:\n  - Maintain sound macroeconomic fundamentals and strong institutions.\n  - Address near-term challenges: transition the property sector to a more sustainable footing and reduce local government debt risks.\n  - Reduce the stock of unfinished housing and give more space for market-based corrections in the property sector to accelerate solutions and lift consumer and investor confidence.\n  - Shift toward higher reliance on domestic consumption by boosting household spending power.\n  - Strengthen the social security system’s reach and increase benefits—“think of strengthening the pension system in a fiscally responsible way.”\n  - Improve allocation of capital via a stronger business environment and a level playing field between private and state-owned enterprises.\n  - Invest in human capital: education, life-long training, reskilling, and quality health care to raise labor productivity and incomes.\n- AI and technology:\n  - AI preparedness is immediate: four critical areas are digital infrastructure, human capital and labor markets, innovation, and regulation and ethics.\n  - IMF analysis finds China “at the forefront of emerging economies in terms of AI preparedness,” with well-developed digital infrastructure providing a head start.\n  - Recommended actions: establish a robust AI regulatory framework and strengthen economic ties with other innovative countries.\n- Green transition:\n  - China is the global leader in deploying renewable energy and is making rapid progress in green mobility.\n  - Policy steps to improve decarbonization efficiency: sell a greater share of electricity at market prices and extend emissions trading system coverage to the industrial sector."
    },
    {
      "heading": "Policy recommendations and reforms",
      "content": "- Macroeconomic and fiscal:\n  - Preserve sound macroeconomic fundamentals and rebuild policy buffers while pursuing consolidation.\n  - Tackle local government debt risks and property sector imbalances decisively.\n- Structural and market reforms:\n  - Implement comprehensive pro-market reforms to lift productivity and growth (see 20 percent/US$ 3.5 trillion scenario).\n  - Strengthen the business environment and ensure a level playing field between private and state-owned enterprises.\n- Human capital and social protection:\n  - Expand social security reach and increase benefits where fiscally responsible, including pension reforms.\n  - Scale up investments in education, life-long training, reskilling, and quality health care.\n- Technology and innovation:\n  - Build on digital infrastructure strengths, adopt robust AI regulation and ethics frameworks, and deepen ties with other innovative countries.\n- Climate and green policies:\n  - Advance market pricing of electricity and extend emissions trading system coverage to industry to improve decarbonization efficiency."
    },
    {
      "heading": "International cooperation and the IMF’s role",
      "content": "- Cooperation is essential to address shared challenges—fragmentation, climate change, and debt—which disproportionately affect the most vulnerable.\n- China’s contributions and engagement:\n  - China has strengthened the IMF’s financial capacity through contributions to concessional lending instruments for low-income countries, the Resilience and Sustainability Facility, and capacity development initiatives.\n  - China helped forge the agreement to increase the IMF’s permanent resources by “50 percent.”\n  - China plays an important role in addressing debt distress in emerging and developing economies; further creditor work is needed to speed up debt relief and China’s continued strong engagement is welcomed.\n- The IMF commits to being a partner to China through ongoing policy dialogue and mutual learning."
    },
    {
      "heading": "Key statistics and figures (as stated)",
      "content": "- “Over 3 percent growth this year and next.”\n- Medium-term global growth expectation: “around 3 percent.”\n- Pre-COVID decade annual average global growth: “3.8 percent.”\n- China 2023 growth: “exceeding five percent.”\n- Pro-market reform scenario for China: “a 20 percent expansion of the real economy over the next 15 years” = “US$ 3.5 trillion.”\n- IMF permanent resources increase: “50 percent.”\n\nRemarks by the Managing Director Kristalina Georgieva at the China Development Forum, March 24, 2024, Beijing.\n\n---\n\n\n References\n\n- https://www.imf.org/en/about/senior-officials/bios/kristalina-georgieva\n- People's Republic of China and the IMF\n- IMF-World Bank Debt Sustainability Framework for Low-Income Countries -- A Factsheet\n- Speeches\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2024/03/24/sp032424-md-cdf-remarks"
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    "Published: March 24, 2024",
    "The year ahead will require careful calibration of monetary and fiscal policies to secure a soft landing — bringing inflation down while maintaining growth firmly in positive territory.",
    "Central banks must decide when to cut interest rates and by how much, based on data, because the pace of disinflation and growth are diverging across countries.",
    "Fiscal authorities need to embrace consolidation to reduce debt and rebuild buffers, while financing digital and green transformations.",
    "The global economy has proven remarkably resilient due to strong macroeconomic fundamentals, robust consumer and government spending, held-up labor markets, and normalized supply chains.",
    "Projections and medium-term outlook:",
    "Structural challenges: low productivity growth, high debt levels (especially for emerging and developing economies), and geopolitical tensions affecting trade and capital flows.",
    "Opportunities: digital and green transformations can boost productivity growth and living standards; deep structural reforms can enhance entrepreneurship, innovation, and economic performance.",
    "Regional note: In Asia inflation rose less and is coming down faster, so interest rates have not risen as much.",
    "Recent performance:",
    "Medium-term role:",
    "Reform potential and quantitative scenario:",
    "Core ingredients for high-quality growth:",
    "AI and technology:",
    "Green transition:",
    "Macroeconomic and fiscal:",
    "Structural and market reforms:",
    "Human capital and social protection:",
    "Technology and innovation:",
    "Climate and green policies:",
    "Cooperation is essential to address shared challenges—fragmentation, climate change, and debt—which disproportionately affect the most vulnerable.",
    "China’s contributions and engagement:",
    "The IMF commits to being a partner to China through ongoing policy dialogue and mutual learning.",
    "“Over 3 percent growth this year and next.”",
    "Medium-term global growth expectation: “around 3 percent.”",
    "Pre-COVID decade annual average global growth: “3.8 percent.”",
    "China 2023 growth: “exceeding five percent.”",
    "Pro-market reform scenario for China: “a 20 percent expansion of the real economy over the next 15 years” = “US$ 3.5 trillion.”",
    "IMF permanent resources increase: “50 percent.”",
    "[https://www.imf.org/en/about/senior-officials/bios/kristalina-georgieva](https://www.imf.org/en/about/senior-officials/bios/kristalina-georgieva)",
    "[People's Republic of China and the IMF](http://www.imf.org/external/country/CHN/index.htm)",
    "[IMF-World Bank Debt Sustainability Framework for Low-Income Countries -- A Factsheet](https://www.imf.org/en/about/factsheets/sheets/2023/imf-world-bank-debt-sustainability-framework-for-low-income-countries)",
    "[Speeches](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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