Tuesday, September 15, 2009

WEF Call for Increase in Chinese Spending to Stimulate Trade

Major Changes for Worlds Transport and Logistics Groups Expected
Shipping News Feature

DALIAN, CHINA The third annual meeting of the World Economic Forums’s “New Champions” ended on Saturday having established that the country’s affairs are having a revolutionary global impact on trade routes. Old markets are depressed whilst new ones arise as China steps into the economic void which has occurred due to financial problems in the West.

Consumer demand, rather than international regulation or government stimulus packages, will drive these changes. “The world from before the crisis is not coming back, said Mr Ben J. Verwaayen, CEO of Alcatel-Lucent, France, and a mentor of the meeting who felt that “confidence, transparency and innovation,” formed the key components of recovery.

The need for a domestic demand driven economy rather than the export led assault of recent years was emphasised, not least by the Chinese speakers led by Wen Jiabao, Premier of the State Council of the People’s Republic of China, who announced a series of social reforms to encourage a change from personal savings to consumer spending including a pensions insurance scheme for the elderly.

Mr Wen stated that in future China will combat climate change, oppose protectionism and protect intellectual property rights. “Over the past year, the world economy has experienced the most severe challenge since the Great Depression,” said Wen. “Thanks to the concerted efforts and active measures of the entire world community, the global economy has started to recover.”

The financial collapse which has caused many western companies and countries to cut to the bone their Asiatic imports has produced resentment in their suppliers. The Chinese have moved swiftly to provide lines of capital and labour whilst opening up their own market to foreign exports. As this trend develops, which it inevitably will, there will be a scramble to become preferred sources for the Chinese market and logistics suppliers should move now to ensure they can expand their services to encompass the new trade routes which will increase exponentially.

Pic. Wen Jiabao with Klaus Schwab Exec. Chairman WEF