Chapter 1
The World Economic Setup With Reform

There is the common saying: "To the same question, 100 economists will give 101 answers". This shows that economists hold very divergent views on various issues. However, if I present to them the statement that "the world economy at present is out of balance", we will find that their views are unprecedentedly in agreement.

There is a general consensus that "the world economy is out of balance" and "the world economy needs to be re-balanced". However, views differ dramatically on "who should bear the responsibility of re-balancing the world economy" and "how can the world economy be re-balanced".

We can say that to the world today, the re-balancing of the world economy has gone beyond the realm of pure economic analysis by economists. Indeed, all sorts of factors, including the separation of interests, political pressure, and social reform, are interwined in this matter, which has probably become the most complicated but also most important and most imperative issue.

The stage is set for the re-balance of the world economy, and the curtain for the re-balancing act has risen. Who will be the hero on the stage? What role will China play in this play? Re-balancing is the process of adjustment and reform. Adjustment incurs cost, and so will reform. Who will shoulder these costs? The road of re-balancing in the world economy will be long and winding, and beset with difficulties and hardship