A New Global Growth Paradigm in a Multimodal World

Keynote speech: Permacrisis: A Plan to Fix a Fractured World by Michael Spence, Advisory Board Chairman, Asia Global Institute

The global economy was discussed to be currently undergoing a significant shift, according to Michael Spence. In the past, economic growth had predominantly been demand-driven; however, it was noted that supply-side constraints, such as an aging population and declining productivity, are now becoming the primary limiting factors. Additionally, it was highlighted that political considerations and security concerns have begun to overshadow the supply chains that were once built on economic efficiency and comparative advantage. Despite these challenges, the panelists acknowledged the extraordinary advancements in technology and science over the past few decades, which offer a glimmer of hope. Digital technology, biotechnology, and artificial intelligence were recognized for their potential to generate significant increases in productivity.

Regarding the future of the global economy, Pol Antràs expressed the belief that the US-China relationship holds greater significance, even though conflicts in Ukraine and Gaza were deemed more urgent. He asserted that China is highly committed to a multilateral world trading system, and if both countries recognize this, they can collaborate for the benefit of the global economy. Unfortunately, it was observed that the current trajectory of US-China relations appears to be diverging from this ideal. Concerning the outlook of the Chinese economy, Fred Hu contended that China still possesses ample fiscal space and policy tools to stimulate the economy if necessary. However, the primary focus should be on restoring consumer and investor confidence through regulatory reform, according to Hu. Belinda Wong from Starbucks China added that the private sector is also impacted by geopolitical tensions. Instead of dwelling on the actions of major powers, businesses were advised to concentrate on strengthening their connections with customers and communities. This approach has enabled them to grow even during the height of the pandemic and amid geopolitical turmoil.

The panel discussed the need for addressing climate change, making strategic investments, and promoting sustainable growth to ensure a healthy, equitable, and prosperous future for all. Moderator Andrew Sheng emphasized the challenges and opportunities in climate, investment, and sustainable growth, highlighting the potential for groundbreaking change through international cooperation and significant investments in transitioning to a net-zero future.

Kishora, Vice President of the New Development Bank, emphasized the need for investment in both climate and sustainability for sustainable growth. He argued that blending the two and viewing climate change as an opportunity rather than a problem can drive the economy forward. He cited examples such as renewable energy and infrastructure development.

Leung pointed out the importance of investing in affordable and innovative healthcare aligned with sustainability. He discussed examples from gene therapy and clean tech, emphasizing the potential of new technologies like AI and synthetic biology to address global challenges.

Solheim highlighted the optimistic outlook in the discussion, emphasizing that the current moment in human history is the luckiest, with increased life expectancy and fewer wars. He discussed the leading role of China and India in the green revolution, focusing on the need to change mindsets towards the opportunities of climate change, address permitting issues, and ensure a fair transition to avoid political resistance.