China's central bank is cutting rates to stimulate its struggling economy and signal that growth is on the agenda.
Jake Sullivan, the US national security adviser, has called on China to be more transparent about the state of its economy as Beijing grapples with a slowdown that poses risks to global growth.
China’s government last week halted publication of data on its soaring youth unemployment amid concerns that itwould reveal new weakness in the recovery of the world’s second-biggest economy, and has cracked down on corporate due diligence reporting in the country.
“These are not in our view responsible steps,” Sullivan told reporters in Washington on Tuesday, US time. “For global confidence, predictability and the capacity of the rest of the world to make sound economic decisions, it’s important for China to maintain a level of transparency in the publication of its data.”
Sullivan added that the White House had in recent months seen a “reduction in the level of transparency and openness with respect to recording basic things” as well as a crackdown on companies that offer “basic information to the world on the puts and takes in the Chinese economy”.
Sullivan’s appeal to Beijing came as Gina Raimondo, the US commerce secretary, prepares to travel to China at the end of this month for talks with high-level Chinese officials, in the latest push by Washington to stabilise relations with its economic rival.
President Joe Biden earlier this month signed an executive order banning some outbound US investment in Chinese technology sectors, and the administration has made efforts to break the dependence on Chinese supply chains central to Washington’s re-industrialisation and economic strategy.
US national security adviser Jake Sullivan Jake Sullivan called for Beijing to ‘maintain a level of transparency’ in its economic data. Photo / Manuel Balce Ceneta, AP
Beijing has countered with an attempt to elevate the Brics bloc of emerging markets into a full-scale rival to the G7. It has also fostered geopolitical ties with countries around the world through its Belt and Road Initiative, focused on infrastructure projects and investments.
Sullivan on Tuesday formally announced Biden would travel to India next month for the G20 leaders summit in New Delhi. The president would focus “his energy” on having the US and “like-minded” countries bring more economic support for the rest of the world, particularly in the “global south” — and mainly through the IMF and the World Bank, Sullivan said.
“We have heard loud and clear that countries want us to step up our support in the face of the overlapping challenges they face,” Sullivan said. “So as we continue to extend the critical support for Ukraine, we’re going to be delivering for the rest of the world as well.”
“And given both the scale of the need and frankly the scale of [China’s] coercive and unsustainable lending through the Belt and Road Initiative, we need to ensure that there are high-standard leverage solutions to the challenges countries are facing,” he added.
Sullivan noted Biden had asked for additional funding for international financial institutions in his latest supplemental budget request to Congress.
The US commitments would generate $50 billion (NZ$84.1b) in lending to middle-income countries through the IMF and the World Bank, Sullivan estimated, but the figure would rise to $200b if other allies and partners participated too.
But Sullivan said he did not see those steps as an effort to counter the growing push by Brics countries — including Brazil, India, Russia, South Africa and China — to set their own economic model for the world, and denied Washington saw the bloc as a “geopolitical rival”.
“This is a very diverse collection of countries in its current iteration... with differences of view on critical issues in the Indo-Pacific, Ukraine, on a range of other things,” he said.
