reporter2
19-11-21, 12:13
Bloomberg New Economy Forum
World headed for a 'very dangerous place' if US, China cannot stabilise relationship: Former US official
Past US Treasury Secretary Hank Paulson delivers warning days after Biden, Xi hold first virtual summit
Nov 19, 2021
BLOOMBERG - THE world is headed for a "very dangerous place" if Washington and Beijing are unable to stabilise their relationship, former US Treasury Secretary Hank Paulson said in a speech on the second day of the Bloomberg New Economy Forum in Singapore.
The blunt warning came just days after US President Joe Biden and his Chinese counterpart Xi Jinping held their first virtual summit, signalling a tentative effort to put a floor under ties between the two countries.
While those talks were a step in the right direction, one meeting alone will not resolve the tensions between the world's largest economies, Paulson warned on Thursday (Nov 18).
"We need more certainty around how the US and China are going to compete, where we are going to cooperate, and how we are going to manage conflict. Otherwise, the world is heading for a very dangerous place," he said.
"We should not dismiss what a failure to do so might mean for the world," he added.
"Great powers rarely desire to go to war. But history is replete with horrifying examples of how they stumbled into it, nonetheless. We cannot just count on cool heads and better angels."
In his speech, Paulson - who in 2018 warned of an "economic iron curtain" dividing the world - said mechanisms are needed to avoid partial decoupling between the two economies that would lead to a crisis.
"Wholesale financial decoupling is impossible, and partial decoupling is likely to make the United States, China and the world more susceptible to financial crises," said Paulson, who was the chief executive officer of Goldman Sachs before becoming Treasury Secretary in 2006.
Separating from China would also weaken the US as a global leader and hurt the competitiveness of American firms.
"We need my friend and successor, (current Treasury) Secretary Janet Yellen, to continue her communication with (Chinese) Vice-Premier Liu He aimed toward transparency, greater harmonisation, and coordination of financial regulations and accounting principles," said Paulson.
World headed for a 'very dangerous place' if US, China cannot stabilise relationship: Former US official
Past US Treasury Secretary Hank Paulson delivers warning days after Biden, Xi hold first virtual summit
Nov 19, 2021
BLOOMBERG - THE world is headed for a "very dangerous place" if Washington and Beijing are unable to stabilise their relationship, former US Treasury Secretary Hank Paulson said in a speech on the second day of the Bloomberg New Economy Forum in Singapore.
The blunt warning came just days after US President Joe Biden and his Chinese counterpart Xi Jinping held their first virtual summit, signalling a tentative effort to put a floor under ties between the two countries.
While those talks were a step in the right direction, one meeting alone will not resolve the tensions between the world's largest economies, Paulson warned on Thursday (Nov 18).
"We need more certainty around how the US and China are going to compete, where we are going to cooperate, and how we are going to manage conflict. Otherwise, the world is heading for a very dangerous place," he said.
"We should not dismiss what a failure to do so might mean for the world," he added.
"Great powers rarely desire to go to war. But history is replete with horrifying examples of how they stumbled into it, nonetheless. We cannot just count on cool heads and better angels."
In his speech, Paulson - who in 2018 warned of an "economic iron curtain" dividing the world - said mechanisms are needed to avoid partial decoupling between the two economies that would lead to a crisis.
"Wholesale financial decoupling is impossible, and partial decoupling is likely to make the United States, China and the world more susceptible to financial crises," said Paulson, who was the chief executive officer of Goldman Sachs before becoming Treasury Secretary in 2006.
Separating from China would also weaken the US as a global leader and hurt the competitiveness of American firms.
"We need my friend and successor, (current Treasury) Secretary Janet Yellen, to continue her communication with (Chinese) Vice-Premier Liu He aimed toward transparency, greater harmonisation, and coordination of financial regulations and accounting principles," said Paulson.