China to play pivotal role at Hamburg summit

Momentum established at Hangzhou last year should place China firmly in the driver's seat

As the 12th G20 summit takes place on July 7 and 8 in the vibrant, bustling business city of Hamburg, Germany, any analysis of the proceedings first requires an understanding of the current context and progress made at recent summits.

The previous summit, held in hypnotic Hangzhou, Zhejiang province, on Sept 4 and 5 last year, set out a clear medium-term direction for the G20, with the overarching goal of working toward an innovative, invigorated, interconnected and inclusive world economy.

Despite this very laudable and eminently sensible objective, the current economic and political climate presents major challenges, and tangible progress is not in abundance.

Both Brexit and the election triumph of US President Donald Trump threaten almost a reversal of the liberal integration of the global trading environment. In addition, the G20 has been labeled as too big and consisting of too many diverse economies, which results in little more than a talking shop.

But surely the G20's diversity is one of its many strengths, and of course the organization is best placed to allow and facilitate the further development and integration of the world's rapidly emerging economies.

The G20 will soon usurp the G8, but in order to do so with the full support of the global business and investment community, it urgently needs leadership. Look no further than China.

Since the Hangzhou summit in September last year, China has continued to push forward firmly with inclusive, integration-led economic initiatives.

Chief among these is the Asian Infrastructure Investment Bank. Not only has this initiative brought together many Asian economies, but it has also opened the path toward more effective cooperation and collaboration between East and West, with most major European countries signing up for full and active participation.

The AIIB also very recently received a triple A credit rating from leading ratings agency Moody's.

At the Hangzhou summit, China and the Chinese government also presented inclusivity and togetherness as key to sustainable economic growth worldwide. Hangzhou may well be seen as the beginning of China as the G20's natural leader.

As China presses on with the Belt and Road Initiative, this leadership mantle sits more and more comfortably.

Even Trump, with an unapologetically US-first agenda, appears to recognize China more and more as deserving of a seat at the top table. Since Hangzhou, Sino-US relations have warmed significantly.

So, what should we expect emerging from the current G20 summit?

Certainly, China will play a pivotal part in this summit, leading the debate and discussion throughout.

But don't expect major government policy announcements and/or trade deals concluded at Hamburg.

Instead, under China's leadership, expect to see a more prominent part played by the business community and the technology and energy sectors in particular.

What other G20 member nations, and most nations around the world, should learn from China and the Chinese government is the support given to innovation and creativity in industry as well as industries of the future.

Hamburg will allow the China-led G20 to reiterate total commitment to the importance of innovation in business but, crucially, that it is only with effective government support that the industries of the future can flourish.

Hamburg will also see China take a far more active role in discussion and progress on global security and immigration. In so doing, China will expedite much-needed integration between Asia and Europe, and it is only China that is both able and willing to do so.

Building on last year's Hangzhou summit, the Hamburg summit, with its very European setting, will further cement the G20's leading role in steering the world economy.

Just when the world economy is in need of a boost, it is the G20, that will come to the rescue.

The city of Hamburg will also contribute to a very successful, harmonious summit. A distinguishing feature of the German economy over tens of years, and perhaps the key reason underpinning the success of German business and German brands globally, has been an inclusive approach.

German business leaders and politicians have always displayed humility and adopted an inclusive approach to trade and investment, not too dissimilar from the Chinese approach in recent years.

So, while the Hamburg summit might appear to come up short on specific, detailed announcements, it will serve to reinforce the dominant business paradigm of innovation and inclusivity.

If the Belt and Road and AIIB initiatives are not sufficient for some to accept China, look to Hamburg and future G20 get-togethers for more discussion and progress toward the establishment of an economic free-trade area sweeping across the entire Asian continent.

Last year's Hangzhou summit not only marked the beginning of China's leadership role, but also an unswerving commitment to innovation, inclusivity and integration as the pillars of the world economy.

A happening Hamburg summit will seize the momentum established at Hangzhou and place China firmly in the driver's seat.

The author is a visiting professor at the University of International Business and Economics in Beijing and a senior lecturer at Southampton University. The views do not necessarily reflect those of China Daily.

(China Daily European Weekly 07/07/2017 page11)