Calling for structural reforms to bolster global growth, business leaders and experts today emphasised that politicians need to do their work rather than just depend on monetary policies.
Participating in a discussion on the new global context at the World Economic Forum (WEF) annual meet here, business leaders opined that monetary policy alone cannot bolster growth.
“Policy-makers shouldn’t kid themselves… They need to deliver policy reforms, not just loose monetary policy,” Axel A Weber, Chairman of Swiss banking major UBS, said.
According to him, labour market and pension reforms are important.
“Right now structural reforms are the only game in town. We need politicians to act,” Min Zhu, Deputy Managing Director at the International Monetary Fund (IMF), said.
The senior official from the IMF, which is playing a key role in reviving global economic fortunes, said that globally, whole banking sector is much stronger than a few years ago.
“… the risks have moved into the shadow banking sector,” he noted.
The suggestions come at a time when the world economy is facing multiple challenges, especially problems in the euro zone.
John Rice, Vice-Chairman, GE, Hong Kong SAR, emphasised that need for developing infrastructure to ensure sustainable growth.
“You don’t have sustainable, inclusive growth unless you have jobs, and you don’t create jobs unless you have good basic infrastructure,” he said.
David M Rubenstein, Co-Founder and Co-Chief Executive Officer of global major Carlyle Group, noted private equity is expected to provide more funding for infrastructure projects.
Zhang Xin, Chief Executive Officer and Co-Founder of China-based SOHO, said that unlike Europe, China is suffering from too much investment and inadequate consumption.
“How do we grow consumption? We need tax reform,” she said.
More than 2,500 participants are taking part in the WEF annual meet, which is on till January 24.
