GUANGZHOU, China, Dec. 5, 2022 /PRNewswire/ — Financial experts addressed major challenges and proposed solutions for the problems the financial system faces at the IFF Annual Meeting kicked off on December 2.
Zhang Xiaoling, CEO of HuaAn Fund Management, said that the current global financial system is largely solid, nevertheless inflation has become a serious issue in a roundtable discussion at the IFF Annual meeting.
There is no global economic crisis in the short run
According to the newly-released IFF 2022 Global Finance and Development Report, inflation will continue into 2023 despite the tightening of monetary policies by central banks around the world. More emerging economies may have difficulties handling their debt as a result of the tightening of international financial conditions. However, most in attendance believed that short-term systemic threats to the world’s financial system will not materialize.
The current inflationary environment presents risks and challenges
Domenico Siniscalco, IFF Vice President, Vice Chairman of Morgan Stanley and Italy’s former Minister of Economy and Finance said that global supply chains are being undermined by geopolitical factors, and that slow regional growth and the tendency towards protectionist or isolationist economies is exacerbating inflation. Risk management needs to be well-executed by central banks, he added.
Henny Sender, former Managing Director at BlackRock, remarked that fiscal policy is crucial to financial stability and that the spillover effect of the Fed’s interest rate hikes is posing challenges globally.
Chang Soon-Young, Chairman of Midas Asset, said that rising inflation makes it challenging for businesses to retain talents in many countries. Inflationary pressures are making venture capitalists and private equity firms increasingly cautious, with finding new sources of funding becoming a priority due to rising financing costs.
China’s practices could be an example for the rest of the world
From 2013 to 2021, China’s contribution to global economic growth averaged 38.6%. From January to September of this year, China’s inflation rate stood at 2%. The reasons why China has been able to maintain high growth and low inflation were because a good agricultural harvest and the stability of energy prices, according to IFF Vice President Zhou Hanmin. China serves as an excellent example for the stability of the global economy.
Speakers also emphasised the importance of global cooperation. Zhou Hanmin said global cooperation brings benefits to all.
About International Finance Forum (IFF)
The International Finance Forum (IFF) is a non-profit, non-official independent international organization founded in October 2003 by leaders from China, the US, the EU and the other G20 countries, in concert with emerging economies and the leaders of multiple international organizations, including the UN, the World Bank and the IMF. Also known as the Finance 20 (F20), the IFF is also a high-level permanent dialogue mechanism and multilateral cooperation organization within the world of finance.