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where attending the st petersburg international economic forum and the topic of our panel is are we witnessing a paradigm shift in the global economic order well the answer of course is yes it's a matter of degree. welcome to our panel discussion here our proposition is are we witnessing a paradigm shift in the global economic order so as to the question yes obviously there is a paradigm shift going on what does a paradigm shift mean is it a win win situation for everyone involved and if it isn't what does it mean to lose in a paradigm shift and i could ask one of all our member of our panel here to kick it off for us addressing that question whether. if you look now into the general economic development also political development globally speaking you see on the one hand that the there is a tendency to read nationalize politics to try to regulate. it's

a important questions on the more national level you see it in the u.s. obviously you have seen it and seen it rochelle you can also see it in the european union's member states and on the other hand is that it is certainly a bad thing i mean you're you make a tip. i come i come through because it was a reaction to neoliberal yeah but you know what i'm going to stand you look into the growth of the global economy it slows down trade slows down globally speaking f.b.i. has been reduced significantly in the past 2 years and on the other hand you have global make up trends new ones like the digitalisation that we see at the moment and climate change and obviously these mega trends need more international cooperation india and in order to give an answer to this in order to be able to regulate it in a problem and so that human kind doesn't have losers and we know so much let's know for example of climate change certainly there is it's a lot of also business potential in this and for example in germany does is a big discussion for the last 20 years

a lot of things have been done when we look into the question of energy consumption as a one point and certainly companies who are inventing new technologies and new processes related to the energy consumption and reduction of c o 2 emissions are certainly witness of this situation and on the other hand the question of climate change is linked to migration and their knowledge interrelated i think that's it's really the problem because you know there are as you pointed out there are forces that want to retreat from internationalization but on the other hand to solve some of these problems it has to be international jumpier you want to do is to try to create a need to your question who we knew who was as a foreigner in a was you needed to resume you not that i didn't you know from the united states governing everything and now we come and we are. of protection and we are and all of the worldwide globalization now the new frame easier

e generation or does it change you know of asia you of both america and you off china of course we you. we are not working together on europe and continue on in his breach between asia and the united states as west and east and you know we will be served the loser because you know who us to win is a gross underwears under have been as of the population so in that case we have to give everybody's of accessibility to the 2 groups and of course millions are on if we don't do without europe and russia on the continent and we even don't organize this new frame oriented energetic regularization of of the trade and business or of course only our friend from china will win because you are to be on point 7 again 150 years 8 and we 1000000000 and big media europe press russia and

600000000 united states so it is younger to you are there let's go to paul all jump in i thing in this context actually protectionism no winners everybody will loose one way or the aga searching from this slowing down in global growth. that the impact on business investment decision and hiring as well as the volatility in the financial market so we see in hong kong obviously being a founder of deputy oh. and located for free trade multilateralism based so that there is a division of labor and they could supply chain being built up over the world so that we can leverage our respective strength and shared a foot of success it isn't really that one of the biggest problems in its highly contentious because it's a political issues and ever since the end of the 2nd world war century to to now it's the united states of the washington consensus it's called it's made the rules

it's not a clickable it and rules don't work for their advantage and now we have a changing economic global system and all the rules hold some people back in from. others it picks winners and i think this is. going to be a very contin aisha's political debate because the rules favor some at the expense of others david miller sure i do agree with out there and always there's a sell side economist also if a column is at the time so i went to have it all i would submit it to be expected in this pounds of play a role of someone who represents the usual sort of neo liberal views but in fact i would actually think that i think that you know as frank mentioned obviously that in the way back to sort of regionalization it would have been news and you know that's that's something that has been emphasized again but i think it was the issue was always the distribution consequences right not everybody believes in david

cardo even if you do believe in the review cardo the art was always the one who came up with the idea of comparative advantage there are winners and losers within societies and i think we have many companies feel to pull pretty good with that which has led to the issue of massive inequality which which which happened in the face of a massive decline in clovelly inequality it all we have now these particular issues in the western countries to deal with. and i think i would disagree a little bit the point that everybody loses it's true that it reduces from a global perspective but if you look at it from a distributional perspective within some countries there may actually be some people who gain and at least in the relative basis and the inequality is about. the perception of will being countries may have a great ability to again regulate the domestic economic systems but then. again the taxation away from individuals back to corporates and again obviously not an interest in educating that but that's that's that's possibly the way it's going

to it's going to go. we treat thanks in all my battle holy point of view because you know all ideals new paradigm. and what is new paradigm we have a global economy joining 5000 euros a goal so early all our life is kind of a little more of the global economy superbikes news it's not possible to say that global economy is absolutely beautiful or protectionism it's a kind of evil because it is mitigated fight brewing over there is there's there's issues i mean you know like the trumpet ministration is weaponized the dollar ok i mean that affects everybody in the world the next global trade significantly you can talk about globalization in that sense him and i suppose the entire world will become is always connected but when you have one or 2 countries that can call the shots that can change the oil prices in a heartbeat not based on it and the economic rationality but because of a political decision take issue

a little bit with this idea that train you know the slowdown in global trade growth is inherently a bad thing might just be a quite a natural phenomenon the trade doesn't grow forever faster than incomes and i think a large part of the reason why trade growth is slowing is because china is becoming more developed so instead of export all of its output there are certain there's a growing domestic market you know i think that a part of this story and on the input side and what previously were imported into china china can now supply itself so there's a vertical integration going on in china and because it's so large it affects global trade flows so eventually you probably reach some equilibrium way down the road where where trade and income i.e. g.d.p. kind of grow at the at the same levels in terms of the income distribution argument which we treat here a lot of winners and losers i think one you know let's think about it this way you

think about income distribution within countries and think about income distribution between countries it's hard to argue the fact that global trade the growth of global trade has improved. income distribution between countries so we have fewer very poor countries so national income levels rise i think that's been demonstrated in china again is probably the best example of that but within countries we can clearly see that income distribution is getting worse so that's not an issue for for governments to coordinate with each other it's governments need to address these issues on the rhone there is a very strong correlation between economies that are open with the exception of hong kong and singapore because there are very small but more open economies tend to have a larger governments because those governments recognise that there is a redistribution role for governments and i'm thinking about really western european countries the nordic countries in particular so there is

a redistribution role for government when trade is a large share of g.d.p. because yes there are winners and losers but if you think trade is advantageous and that's an appropriate role for government to have we if you look historically if you look at the major complex almost every single major conflict in history how say economic trade component to it. and i'm wondering if with this paradigm shift alone that were. do we see a potential conflict built into it because you know we have the city's trap that's what we're really essentially talking about here in this paradigm shift you know when one country is ascending the major power that is the status quo power has options either you allow the rising power to continue their rise even to surpass you you negotiate your decline in the relative rising of your

opponent then of course there is the 3rd variant and it is called conflict ok and in modern history have seen many many of them ok we can look at the the the competition between great britain enjoy. many prior to the 1st world war we can look at the sanctions which united states applied on japan prior to the attack on pearl harbor i mean all these were about trade yes easy knew the little we are not to forget seems to to put 0 because our lives would be formed after the 2nd world war i have math you of our central world bangor central bank you have all these big institutions but. today sort of globalization and now it. is globalization and the bulk of the products in islam i am not sure we have to involve more went to court but you'd be known to surpass the countries with these exactly 2 days emerging going trees sometimes eggrolls you know more power for that

in europe you know and then that would does this notion of greeks you know where russia is emerging countries is a joke saw this economy steve you is it i would they did no global institution us to be modernized to welcome the new comers and to give everybody's right easy global world if not to seize protectionism these projects an ism now pushed by our friend from united states is very negative and if we don't move at the same time zone rules of the game we are big problem like you say it's always before big conflicts into a context you seizes sanctions we have to stop dissension because now we are sanction you know russia. against russia from united states and europe now we are here and you have jumped on you know in this context of sanction to everybody where do we go we have to stop the city get.

globalization period that we had is an order to be a new globalization period it will be network driven. that america will become a subscription service like netflix you all subscribe to america and they have proper value proposition to keep your subscription alive.

if you look at the trade negotiations between china in the united states. just over the last few weeks i mean there was the western media really gave a very odd skewed interpretation of what happened because essentially what the united states is doing is demanding. regulatory torrie changes the way china does business i mean outside power dictating the terms and conditions of our you run your economy and of course the chinese said no the thing is what what does sovereignty mean in all of this paradigm shift i think that's the big question right here because we started out you know what no one said the word yet but i'll say it bragg's it ok we have a lot of the european parliamentary elections that showed the the the center is collapsing and a lot of it gets down to understanding how this paradigm shift is moving forward and remain maintaining your sovereignty and no one has been able to really figure out how to square that circle when you look at how china responds it has been very

measured. oh of self defense and going back to your you know your earlier question about a possible conflict it has always been stated that it is not the ambition of china to claim well number one ought to become a supreme power if you look at the batman role initiating what just being emphasis is working to bad. benefits openness in course if innes and not being a chrome spy become so the mentality i will fall off of china is really different when compared to that of the united states let me come back to the brics it's a very good point we are starting from. a loser of between nations by the raw losers and the winners inside the countries and that is so much bigger problems that it's a clear signal that. more reach and more satisfied from of the go is

a global ization solves all for england long them. there is an awful finland which is absolutely dissatisfied the last 20 years. on the political system in the us it's the same story the senate story so maybe this is an even bigger problem sure and i don't rule political consequences so for. windows and losers inside the country i just want to say that in the past 30 years up until recently their global economy has been living a dream and many new developing countries were integrated into the system they learned to enjoy the fruits of the system of the architecture of financial trade legal that was actually created by the western world and now that their roles in their economic power and they basically compete for the same share of the fight with those who created this architecture and. this is a more. this is

a and only trade related conflict because the paradigm that was created during those 30 years is based upon the supply chain system so. they used the local markets in the developing world they use their labor costs lower labor costs they shifted their production overseas to maximize their profits and those countries. from those supply chains integrations and now that they moved to higher levels of value. they basically compete with those who created the supply chain and so the question of the title of the session is whether this is a paradigm shift the answer to this question is very tricky because a lot depends on how this conflict in substance is not a trade but it's purely economic financial existential how this

conflict is managed so that if they do if the software and everybody will be fine if they do the hard. created supply chains and there will be a shift. of interest. so. everybody. knew. the new rules of the game. very interesting currency for. everything. completely chance.

of i.m.f. and exit is completely out they did always go by the same europa weezer agreement of the united states i believe just ip few but now we are. happy if you we have an economy of everybody so what we have to emphasis is the spirit of working together for share benefit mutual benefit when you go to our 1st row here see how you are and you want to. thank you peter as being a fascinating discussion. which covered many topics i've noticed actually peter you'll have been trying to bring the discussion in somehow to the dominance of united states and reluctance for the us to to to. the so maybe on that i would like to make some comments and 1st comment is about china's growth being looted by won't be

a panelist i think right now china needs to grow slower not faster that's a very different thing from this conference if china can grow at 4 percent. i shall be very happy so to some hans most economists know who. he was born research years years because a current of growth rate is clearly not sustainable i think everyone knows that in china we cannot increase leverage and we cannot. have more conflict with the major trading partners i think that's very important secondly i think it's too early to say this is a paradigm shift cost by treating patients or treat a war because i mean as a financial secretary of kong has said reactions from china so far have been quite measured i think that's a correct policy response in fact i would i do or kate to think

for china one to even get on higher moral ground and to reduce tariffs to help consumers i think this trade war is also a stress test just like financial institutions they need a stress test i think trade war itself clearly touting us financial sector reform in china is a c.v. really liking imagine imagine if we do not have hong kong do you think you have all this in the background i mean kind of economic growth would have been less impressive because we're being all sourcing capital market function 200 imposter 30 years so i think this is a stress test is a wake up call i think i think kind of should really really open up even further to

more yeah i just want to say on the remaking the world. takes a lot of courage and a lot of from those who are already in control that's why they have to think about the future. and make these institutions reflect the economic reality that has changed since since the world war 2 you know and whether this is something they can compromise or question we don't know that yet and one point on the financial sector the financial sector is very important but it doesn't exist in the void its primary object is to finance the real sector operations and that's where the trade in goods and services come into play and that's where you get all this competition let's take a look at this. way i mean it's all about competition it's all about financing the best terms financially and the best products and fortunately if we don't come

up with a rules with a rules based system this will go on forever why we have to do that if we come back to this question of will. system i mean it's not an immediate reaction to the 2nd world war it's a reaction to the preload to the 2nd world war which then which is certainly originated also. let's say to the trade conflict and the great depression which was there no i would say you need so that leaves 3 from these institutions so that they are able to give an answer to the new developments of the new challenges which are there but in fact you mentioned this before you have to compromise and everybody has to compromise here and if let's say the the major force which also has safeguarded to functioning of these institutions is perhaps no broking these institutions or really wanting to compromise on this they certainly would bring us into trouble at the moment i would avoid the war over the world over trade war it's

a trade conflict because if you look into the prehistory of the 2nd would there was a really trade war. that's a much more shop than we have it now but certainly we own a very it's a difficult danger. it's positive moment and here i think that political rationality has to prevail ideally i'm sorry of course out that america's under russian parliament i think it's very difficult to predict what will happen in the world to quantum and world trade and yes because you know not now the meatiness on twitter is broken son pictures book at the moment for me and i remember very well and probably. true also remember what. we're discussing here with the our american colleagues 10 years ago 20 years ago. i think in the ninety's and in the beginning on. this. 10

year as americans convinced russia to join w chill and actually. they positioned the self like a main get around all the liberal economy although that world and. this is a paradox but knowledge i think. the united states to. main threat to this liberal economy how they're built and. they're using all the. instruments all the world trade and dollar as as a rope and as in the comic up on against russia china and not even against mexico so that this is a quite new sedition nobody can predict this 10 years ago so i

think. this trade was sanctions gone through sanctions. and the this is a lose lose situation for everybody and. i think they're all all the u.s. dollar and if you talk about that there. is a risk if you look at the russian currency reserves is change their might to 30 and that. percentage of the us dollar wasn't up to something you know from from a to probe a bit of percent from the price of that is a little down to $35.00 so this is a dramatical situation and i think if in the future the united states will use dollar as of weapon that they're all of dollar will decrease will because their might to quicken isn't a global currency it's all about it's not it's value it's value is trust and if you

compromise sort of trust then it's value is compromised that's what i'm getting out of sort of it is not a political weapon that is all the time we have i hope you have enjoyed our panel discussion we could have gone on and on but i think we've got we've got to be the main points and i appreciate it thank you thank you thank you thank you. i'm. most people think to stand out in this business you need to be the 1st one on top of the story or the person with the loudest voice of the biggest raid in truth to stand out of business you just need to ask the right questions and demand the right answer.

question. well there are very birds or head. or behind of 40 feet but so. out of our group. of these that you. just showed you the human if you did you can see more money as we move. on i'm going to give you show numbers of home. earlier there are levels from. god since we're. in the i learned i need to learn a new believe. this kid or new. york open in addition to me in. miniature the new shit.

leaders meet at the g. 20 summit in a soccer seeking breakthroughs on trade and political standoffs. a whole adult leadership. there are 3 to be working together and they gave us a great opportunity to follow up on that. here. a british waste management was convicted for attempting to send contaminated household trash to china wrongly labeled as a powerful recycling. and it really provides a rescue vessel carrying migrants from.