Chen Weiguang

The world today is undergoing profound changes unseen in a century. In particular， under the impact of the COVID-19 pandemic and the Ukraine crisis， the global political and economic landscape has undergone unprecedentedly profound changes， and the current global economic governance system is facing multiple crises， such as the lack of legitimacy， effectiveness， and common values. Hence， promoting the reform of the global governance system is becoming the prevailing trend.

The driving mechanism of the evolution of the global economic governance system

The global economic governance system mainly refers to the organizational framework and institutional rules and arrangements for conducting economic cooperation and maintaining global economic order established by the international community in interactions. System is an important feature of economic globalization since the end of World War II. The global economic governance system， with the Bretton Woods system as the institutional framework， has set the tone for the development of economic globalization. However， under the impact of external factors， the inherent inertia of the institutional system has made it impossible for the original institutional arrangements to reasonably reflect the new changes in the actors perceptions， power and interest structures. Such contradiction has driven the continuous evolution of the global economic governance system， the course of which can be roughly divided into the following three stages.

First， the period of rise and fall of the Bretton Woods system. The Bretton Woods system， established under the leadership of the United States after World War II， was once the most stable monetary system and the best period for real economic indicators. However， with the outbreak of the War in Korean Peninsula and the Vietnam War， coupled with the impact of the oil crisis， the Bretton Woods system was eventually dismantled by the US when it unilaterally declared the closure of the “Gold Window”.

Second， the period of rise and fall of the neo-liberal system. Neo-liberalism and the Washington Consensus formed under the guidance of this concept were the important guidelines for the formulation of domestic and foreign policies of the Western countries led by the US and the United Kingdom in the 1980s， and also an important theoretical model for dominating the post-Cold War super-globalization. After the end of the Cold War， the global economic governance system moved from the polarization to unification. The Group of 20 was identified as the main forum for international economic cooperation， enabling the formation of a governance system of truly global significance.

Third， the period of sudden changes in the global economic governance system. Entering the second decade of the 21st century， the world economic recovery has been sluggish， global trade has continued to slump， global problems such as energy crises， economic imbalances， public health crises and even geopolitical conflicts have occurred frequently， and the process of economic globalization has been seriously impeded by the rise of anti-globalization. Especially since 2018， the major shifts of China-US relations， the COVID-19 pandemic， the Ukraine crisis and other factors have been driving the accelerated evolution of the once-in-a-century changes. The global economic governance pattern has seen profound adjustments， and the global economic governance system is facing reconstruction.

At present， the drivers leading to the rapid evolution of the global economic governance system mainly come from three aspects. The first is external shocks. External shocks are often the trigger for sudden changes in the global economic governance system. Sudden major events such as wars， economic crises， scientific and technological revolutions， natural disasters and public health events often tend to trigger rapid changes in the international system， whose impact can be either positive or negative.

The second is structural changes. The international system is the solidification of actors concepts， the result of power and the reflection of interests. Hence， structural changes in the concepts， power and interests of state actors are the endogenous driving force behind the evolution of the global economic governance system. First， in recent years， the Cold War mentality has returned， the US perception and orientation towards China has seriously deviated， regarding China as the most important competitor and the most serious geopolitical challenge， and values-oriented diplomacy has become an important means for the US to step up competition and containment towards China. Second， in the evolution of the international power structure， when there is a dominant power， the power monopolist will dominate the design and implementation of the system; when there is no dominant power， the result of the power balance between countries will determine the direction of system changes. The continuous development of multipolarity in todays world has led to accelerated changes in the existing international system. Finally， benefit considerations are the driving force for state actors to push for changes in the global governance system. The distributional effects of the international system are non-neutral for different state actors at the same time and vary for the same state actor at different times. Those with vested interests will strengthen and legitimize the system， while those with compromised interests will question or even challenge the existing institutional system.

The third is the impact of non-state actors. Non-state actors are an important complementary force in the evolution of the global economic governance system. With the advent of the digital era， the influence of super-digital platform enterprises extends from the scope of cyberspace governance to social and national governance due to the publics reliance on network platforms and the lack of government effectiveness in cyberspace governance. Taking EU digital competition policy-making as an example， tech firms now rise above the pharmaceutical， fossil fuel， financial and chemical industries in terms of financial investment in lobbying EU institutions. The rising in investment lobbying by large technology companies and the digital industry as a whole demonstrates that the digital technology industry， and platform companies in particular， have a tremendous and growing influence in the international community and have become important actors in shaping the new rules of the platform economy and promoting changes in the global economic governance system.

Features of the reconstruction of the global economic governance system

The neo-liberalism oriented economic globalization led by the US has been weakening， and replaced by re-globalization featuring diversity， regionalization and digitalization. The evolution of the global economic governance system， has transitioned from a period of slow， low-intensity gradual change in the past to a period of rapid， high-intensity sudden change， and its reconstruction is characterized by the following three aspects.

First， the fragmentation， division and clubbing of the governance forms. After the outbreak of the international financial crisis in 2008， the reform process of the multilateral economic governance mechanisms represented by the WTO and the IMF has suffered a serious setback， and the G20， which once played a sound role in international coordination， has also gradually shown its weakness. On the one hand， with the collective rise of emerging markets and developing countries， the traditional multilateral mechanisms led by developed countries in the past can not reflect the development aspirations of emerging countries， and their legitimacy， fairness and effectiveness have been questioned. Hence， emerging markets have begun to work hard to find breakthroughs， enabling a bigger role of the Belt and Road cooperation mechanism， ASEAN summits， BRICS summits， among others. On the other hand， the failure of the multilateral mechanism and the intensification of the major country competition have led some developed countries to build regionalism and cliquism dominated by them. A series of formal or informal mechanisms created by the US and other developed countries with the intention of reshaping their hegemonic position， coupled with various attempts made by emerging markets to make up for the deficit in global economic governance， have objectively accelerated the fragmentation of the current global economic governance system.

Second， the trend of associating governance concepts with ideology， security or using them as a tool. The US-led concept of global economic governance has gone through the embedded liberalism after the end of World War II to the post-Cold War neo-liberalism. Now that neo-liberalism is out of the question， neo-interventionism， against the backdrop of overstretching the concept of ideology and security， has begun to rise again. In April 2023， US National Security Affairs Advisor Jake Sullivan gave a speech on “Renewing American Economic Leadership” at the Brookings Institution， launching a high-profile campaign of the “New Washington Consensus”， the main content of which is containing Chinas development. The proposal of the “New Washington Consensus” means the bankruptcy of the old US-led “Washington Consensus” based on neo-liberalism and advocating the liberalization of trade and finance and the reduction of state intervention， and it also indicates that on the basis of reflecting on free trade and globalization， the US intends to get rid of its so-called dependence on China by increasing government intervention and reshape its industrial policy， global value chain and international economic order.

Third， the discretization of governance rules in new areas. At present， the world is in a period of historical opportunity to move from industrial economy to digital economy， digital industry， and new energy and other fields have become the frontier of major country competition. Many countries， from the perspective of safeguarding their own interests， have chosen different governance rules and paradigms， and they are all committed to promoting their own governance methods as global rules and standards. At the level of cross-border data flow rules， the US has utilized its global leadership in the digital economy and information technology to strongly promote the policy of free flow of cross-border data. The EU， on the other hand， emphasizes the promotion of cross-border data flows under the premise of maintaining high standards of privacy protection within the single digital market. Most developing countries， represented by Russia， India， and Brazil have adopted localization policies that severely restrict data flows. At the level of algorithmic governance rules， due to the lack of internationally competitive digital platform firms within its borders， the EU puts more emphasis on rights protection， competitive order within its borders， and the preservation of the public interest of society. Considering that the regulation of algorithmic content may be contrary to the constitutional spirit of supporting freedom of expression， and moreover， preventing legislative restrictions related to algorithms from hindering the global expansion of its domestic digital enterprises， the US has consistently insisted on algorithmic governance based on freedom of expression and freedom of the market， and its rules of algorithmic governance prefer confidentiality.

The visions and pathways of Chinas participation in the reform of global economic governance system

Today， a new round of technological revolution and industrial revolution is on the rise， the competition among major countries is becoming increasingly fierce， traditional geopolitics is returning， and the profound changes unseen in a century are picking up pace. In the face of the treacherous and chaotic international situation， China actively participates in the construction and reform of the global economic governance system， and contributes Chinese wisdom and Chinese solutions to promote the development of the global economic governance system towards a more just and reasonable direction.

First， China actively advocates the vision of building a community with a shared future for mankind and maintains and improves the multilateral system of global economic governance. At present， the tide of anti-globalization thinking continues to surge， and the US is trying its best to exclude China in the economic and trade fields， causing the traditional global economic governance system to face the danger of being out of order， and making it difficult to maintain its legitimacy and effectiveness. For this reason， the international community needs to seek a new balance in the collision of values and interests. As the largest developing country and an emerging market， China has consistently practiced the vision of building community with a shared future for mankind and the concept of global governance featuring joint consultation， collaboration and shared benefits. Holding high the banner of real multilateralism， China has put forward the Belt and Road Initiative （BRI）， the Global Development Initiative， the Global Security Initiative， and the Global Civilization Initiative， winning wide recognition and support from the international community. From 5 to 7 April 2023， French President Emmanuel Macron paid a state visit to China， during which both countries pledged to work together to promote security and stability of the world and to jointly address global challenges. The common position of China and France in maintaining and reshaping a peaceful and stable international order is undoubtedly a powerful blow to the economic “decoupling theory” advocated by the US， and injects more stability and certainty into the current fractured global governance mechanism.

Second， China firmly upholds the multilateral trading system with the WTO as the core， and leads a new round of high-level opening-up with its system-based opening-up. On the one hand， its imperative to promote the reform of the WTO dispute settlement mechanism and restore its dispute settlement function. Going forward， China should promote the reform of the dispute settlement mechanism in the direction of speed， efficiency and simplicity， and push for the expansion of the scope of WTO issues， the establishment of a trade coordination mechanism in case of emergencies， as well as the introduction of online facilitation means， and so on. On the other hand， in the face of an increasingly severe external economic environment， China needs to continue to create a market-oriented， law-based， international business environment， and steadily expand the opening of rules， regulations， management， standards and other systems， so as to promote high-quality development of the economy with a higher level of international circulation. In addition to strengthening the protection of intellectual property rights， optimizing the legal environment for innovation， and standardizing anti-monopoly and anti-unfair competition procedures， China will actively dock with international advanced rules， give full play to the role of China-EU economic cooperation as a cornerstone， and continue to deepen the implementation of the RCEP and advance the China-Japan-ROK+ASEAN economic integration， which will surely form a multi-level circle of friends on different economic issues.

Third， China seizes new growth points such as digital economy to offer Chinese solutions for new rules for global digital economy. At present， the world has not yet formed unified rules and a coordinated digital economy governance system among countries， and global problems such as the digital divide are still prominent. While actively exploring norms and principles suitable for its own digital development， China has provided more public goods for the development of the global digital economy. On the one hand， China has given full play to its market advantage and leading edge in digital technology， and shaped the Chinese standard for the rules of the digital economy. China has fully leveraged its comparative advantages in 5G， 5.5G， 6G mobile communications， digital payment services， cross-border e-commerce and other areas， and actively made use of the BRI and the network of free-trade zones to formulate international rules and shape the standard system for digital economy. On the other hand， China has striven to promote the institutionalization of the Digital Silk Road and create a regional platform for digital economy exchanges and cooperation. China has now signed memorandums of understanding （MOUs） on cooperation on the Digital Silk Road with 17 countries， established bilateral cooperation mechanisms for Silk Road e-commerce with 23 countries， and constructed 34 cross-border land cables and many international submarine cables with its neighboring countries. On the basis of consolidating the hard connectivity of the Digital Silk Road and accelerating the construction of digital infrastructure in countries along the Belt and Road， China will continue to improve its soft connectivity， promote in-depth cooperation in digital policy communication， rule coordination and standard compatibility， and prioritize the conclusion of digital economy agreements with economies that have a good digital foundation and have signed MOUs on cooperation in the construction of the Digital Silk Road with China.

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Chen Weiguang is Senior Researcher at the Guangdong Institute for International Strategic Studies of Guangdong University of Foreign Studies