Download Bilateral global governance

AUGUR stakeholder’s workshop, 17-18 November 2011
Bipolar scenario
Presentation:
•China and US intervention: agreement of mutual benefit
more than cooperation
•China: change in the pattern of growth
•US: more active economic policy
•EU: paralysed, lack of consensus on shared objectives
•US and China invest in oil and gas supply at world level
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
China: change in the pattern of growth
• Higher wages, increased household income and
consumption
• Reduced profit and investment in % GDP
• Increased of spending on government services
• Reduced pressure on environment: energy saving,
investment in non carbone energy
• Moderate appreciation of the yuan
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Outlook for China
• Real GDP growth from
7.5% in 2010 to 6.5% in
2020
• By 2030 income per
capita ($2005pp) around
28000$, close to the
current average level in
Europe
• Consumer spending still
well below
Consumer spending per person ($2005 pp)
50,000
40,000
USA
Europe
CIS
South America
China
30,000
20,000
10,000
0
1990
2000
2010
2020
2030
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Outlook for China
Progressive reduce of current surplus
Moderate real appreciation of the
yuan
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Outlook for China
• Energy saving policies
• Reduction of the growth of
the domestic fossil fuel
supply
• 30% of energy needs met
by imports in 2030
compared with 10% now
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
USA:more active policy
• Growth sustained by
government spending and
private investment
• Improvement of around
1% p.a. in GDP growth
• Slow recovery in
employment rates due to
working-age population
growth
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Outlook for USA
• Growth of government
income
• Government debt
increases but the ratio of
debt to GDP declines to
64%
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Outlook for USA
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Europe paralysed
• Marginal impact on Europe from policies of China and
US
• Government debt slightly lower in 2030, but still high in
South Europe (150% GDP) and East Europe and UK
(100% GDP)
• External position still deteriorating down to -100% GDP
in South Europe, East Europe and UK
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Energy policy
• US and China invest in oil
and gas supplies in CIS,
West Asia, North Africa,
Central America and US
• Rising Chinese and Asian
imports of energy
• Stable energy imports in
other regions
• Stabilisation of real price
of oil
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Rest of the world
• Japan and other East Asian countries hardly affected
• India and South America adversly affected by US
policies with less industrial location in South
• No benefit for other countries in Africa and South Asia
• Gains of energy exporting countries from investment in
oil and gas supply compensated by effects of lower oil
prices
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Economic policy issues
US policy
• Downward pressure on $
• Relax of restrictive budgetary
policy
• Recovery as a solution to
public debt problem
revaluation but decreasing
Chinese surplus
• Emergence of Chinese big
business
• RD race between US and
China
China
• Success in implementation of a
new growth regime (higher
wages, pension reforms)
• Yuan under control: limited
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Economic policy issues
Monetary and financial regulation
• No big monetary arrangement
• $ remains the internaational reference currency
• Chinese caution in matter of financial liberalisation
• Pressures on euro and euro zone
Trade policy
• Agreement of mutual benefit beween China and US with relative
marginalisation of the WTO
• US and China negociate reciprocical opening of their markets,
reinforcing their dominant positions
• EU paralysed with defensive position; European liberalisation
policies often unilateral without getting reciprocity, especially in
services and agriculture
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Economic policy issues
Agriculture
• Maintaining US agricultural active policy
• Food independance policy in China
• EU with defensive policy; dismantling of the CAP
Raw materials
• US and China selfish for natural ressources
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR
AUGUR stakeholder’s workshop, 17-18 November 2011
Energy and climate issues
• No significant progress towards more energy efficiency
• Oil intensive pathways and vulnerability to peak oil
• USA and China do not worry about CO2 emissions
• No climate policy ambitioned outside EU
DG Research and Innovation, CDMA building, 21 rue Champ de Mars, Brussels
AUGUR