David Daokui Li: Get prepared for changes in US monetary policy

Upon invitation, David Daokui Li, Director of the Center for China in the World Economy and Dean of the Schwarzman Scholars at Tsinghua University, attended the 19th St. Petersburg International Economic Forum (SPIEF) which started from June 18th. During the 3-day event, which featured heads of state and government political leaders, CEOs and top managers of major Russian and international companies, leading world experts, and representatives of Russian federal and regional authorities, Li shared his views on international monetary policy and the prospects for the world economy in 2015.

Li said that potential changes in US monetary policy will inevitably have a huge impact on the global economy and the likes of Russia must adopt practical measures to stop excessive capital flow in order to stabilize the exchange rate. He added that the function of central banks does not collide with that of other macroeconomic departments and it is the coordination between the two that helped the US and UK surmount the financial crisis.

Speaking on the prospects for the world economy in 2015, Li said that the US and UK are in good shape while other developed countries are still suffering from hardships. On top of that, potential changes in US monetary policy are likely to once again shock burgeoning economies, therefore the latter should get prepared. He believes that China’s economy still has room to improve, but its potential will only be fully realized after a tough period of structural adjustment.