US Treasury Secretary Janet Yellen stated that the United States is closely monitoring China’s economic challenges. Concerns have arisen due to China’s economic slowdown, alongside recession threats in Europe and high inflation affecting global demand for Chinese products.
China’s President Xi Jinping will miss the leaders’ meeting at a time of heightened trade and geopolitical tensions with the United States and India, with which it shares a long and disputed border.
China’s challenges included “less of a pick up in consumer spending that had been anticipated in the aftermath of the Covid restrictions, as well as long standing issues with respect to the property sector and… debt related to that”, she said.
G20 host India overtook its northern neighbour as the world’s most populous country earlier this year, and Yellen added that China’s “labour force is beginning to shrink”.
Xi’s absence will impact Washington’s bid to keep the G20 the main forum of global economic cooperation and its efforts towards a financing push for developing countries.
That includes a plan to increase World Bank and International Monetary Fund lending power for emerging nations by some $200 billion as a better alternative to Beijing’s “coercive” Belt and Road Initiative.
While “aware of the risks to global growth”, Yellen said she had “been surprised by the strength of global growth and how resilient the global economy has proven to be”.
“While there are risks and some countries that have certainly been affected, overall, the global economy has been resilient,” she added.
Yellen added that the “most important negative influence is Russia’s war on Ukraine”.
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Updated: 08 Sep 2023, 12:47 PM IST