(Yicai) Oct. 10 -- The uncertainty and risks of geopolitics are sharply rising and pose new challenges to the stability of the global economy and finance, so countries must review and adjust their operating models to adapt to the new constrained environment, according to the former vice president of the International Monetary Fund.

Since the 2008 financial crisis, trade growth has no longer been the main driver of global economic growth, Zhu Min said at the 2024 Shanghai Global Asset Management Forum today. There has been a decline in the export of tech products and manufacturing and a trend of supply chain realignment, he added.

Global deficits will likely reach new highs in the upcoming years, posing significant risks to financial markets, Zhu noted. Central banks will bear the brunt of the fiscal deficits, he said, adding that their monetary policies are facing unprecedented challenges, requiring a balance between maintaining financial stability and addressing fiscal deficits.

In the face of these changes, nations must reassess and adjust their operating models to adapt to the new constrained environment, Zhu pointed out. China is building a new growth model, focusing on developing the domestic consumer market, strengthening the core competitiveness of its manufacturing sector, and actively cultivating future core competencies, including carbon neutrality transition, technology, and data capital, he pointed out.

Expanding domestic demand, strengthening and enhancing the manufacturing sector, transitioning to carbon neutrality, technological innovation, and data capitalization are all important, Zhu stressed. China will continue to hold a significant position in global manufacturing and play a leading role in green transition and technological innovation, he predicted.

The artificial intelligence era has arrived, and machine cognition enriches human cognition, Zhu noted. China is making every effort to build an AI supply chain, with autonomous vehicles and embodied intelligence set to be breakthrough areas in the future, he said, noting that data capitalization is the new engine of the country's development.

Yicai and the Bank of China jointly host the 2024 Shanghai Global Asset Management Forum. The event involves regulators, economists, globally renowned asset management institutions, and financial infrastructure firms, aiming to promote high-quality development and high-level openness in the asset management industry and build an ecosystem serving the real economy.

Editor: Martin Kadiev