China and world at risk of financial turmoil greater than 2008 crisis, ex-finance minister warns
- Washington is playing a ‘negative-sum game’ with Beijing, and both sides will end up losing if geopolitical strife continues, says Lou Jiwei
- Lou Jiwei urges world’s major economies to rapidly roll back their loose monetary policies or excessive economic stimulus measures will take a global toll
China could be locked into a no-win global situation for years, with the world on the brink of financial turmoil that could surpass that of the global financial crisis more than a decade ago, former Chinese finance minister Lou Jiwei has warned.
Speaking at an economic forum in Shanghai, Lou, currently chairman of the foreign affairs committee of the Chinese People’s Political Consultative Conference (CPPCC) National Committee, urged the world’s major economies to rapidly roll back their extremely loose fiscal and monetary policies to avoid a major global financial problem.
“It is not unlikely that a global crisis more serious than the one in 2008 could break out if the withdrawal pace is not fast enough,” Lou, long known for his outspoken views, said during a keynote address at the 2020 NetEase Annual Economist Conference on Friday.
Lou is the latest Chinese official to warn of the risks posed by what is seen as excessive global economic stimulus.
His comments came even as the International Monetary Fund last week adopted a more optimistic outlook for the global economy this year, citing the stronger-than-expected performance of China and other advanced economies.