An assembly line of an auto factory in the Wuhan Economic and Technology Development Zone Photo: MEI TAO/CHINA DAILY

At an online seminar titled “Epidemic, Economic Countermeasures, National Governance” recently held by the Institute for Finance and Economics at China Central University of Finance and Economics (CUFE), scholars discussed the impacts of the virus and the countermeasures and policy options for national governments.

Dong Zhiyong, dean of the School of Economics at Peking University, said that China has shown its speed, efficiency, strength and ability to the world in its dealing with COVID-19. How severe this disease has impacted China’s economy depends on its duration, impact areas and the cost of policies, and changes will be felt in economics, medicine and sociology. The virus is exogenous, unexpected and temporary. It will impact many aspects in the short term, but it will not change the general trend of China’s long-term economic development. China has formed a set of policies and systems that effectively promote economic and social development and respond to risks and challenges in long-term practice. The manufacturing industry occupies an important position in the global industrial chain, supply chain, service chain and value chain, which is the essential reason behind the resilience and potential of the Chinese economy. 

Bai Yunzhen, an associate professor of the School of Government at CUFE, said that we should base ourselves on domestic economic circulation and strictly prevent imported crises, clarify the social logic of economic growth, take into account overall national security, consolidate China’s status as an economic power, exert the influence of a responsible power and finally promote the construction of a community of shared future for mankind.

The global economic downturn induced by the epidemic will not offset the dividends from globalization, said Zheng Xinye, dean of the School of Applied Economics at Renmin University of China. To promote high-level and deeper globalization, we should coordinate the role of the government and the market. 

We should objectively view the impact of the virus on poverty alleviation, said Wang Lifeng, a research fellow with the Social Sciences development Research Center of the Ministry of Education. At present and for a period of time in the future, we must increase policy support, promote the effective connection between comprehensive poverty alleviation and rural revitalization, establish a long-term mechanism for solving relative poverty and a monitoring and aid mechanism for preventing farmers from falling back into poverty and cut off intergenerational transmission of poverty through education patterns.

Wang Yongjun, director of the Government Budget Management Institute at CUFE, made several essential points about speeding up the fiscal governance reform after the medical, economic and financial shock of the epidemic: reform of the transfer payment system, supply-side budget integration, demand-side budget integration and the establishment of an emergency budget system. 

Gao Wei, a professor of the School of Economics at CUFE, said that under the new macroeconomic situation, we should take into account short-term economic difficulties and continue to implement the basic concept of supply-side structural reforms. Monetary policies should not be over-expanded but nor should too much space be reserved for fiscal policies.

Yao Dongwen, assistant director of the Center for China Fiscal Development at CUFE, said that under the conditions of the modern credit system, finance can directly impact money supply. According to estimates, the direct impact of China’s finance on M2 (broad money) has reached up to 50%. Therefore, it is necessary for us to pay attention to theoretical research in this area and adopt scientific and practical policies. 

(Edited and translated by NIU XIAOQIAN)