Qin Xiao, chairman of Boyuan Foundation (data map), the road to rebalancing is a difficult moment for the whole world. The worsening European debt crisis not only tested Europe, but also affected China. For many years, the EU has been China's largest trading partner, and now this trade cooperation relationship is further unbalanced, which is difficult to reverse in the short term. At the same time, how to rebalance China's economy will inevitably have a far-reaching impact. Recently, at the China-EU Beijing Forum jointly organized by Boyuan Foundation and other institutions, nearly 50 experts, scholars and officials from home and abroad conducted in-depth discussions on China-EU economic relations, China's economic rebalancing and its impact on the world economy, geopolitics and its impact. Among them, China's frank and balanced theory received a particularly warm response. This print chooses its essence and publishes it for readers. Editor's note rebalancing does not mean that the global economic system will return to the split and closed state during the Cold War, but that globalization will enter a sustainable track through structural and policy adjustments. Qin Xiao: How to rebalance the global economy is a major issue facing the world at present and in the future. The economic globalization initiated after the Cold War has provided a new institutional arrangement for the global flow and allocation of goods, capital and services, and greatly improved and promoted the scale and efficiency of global economic activities. The global financial crisis that broke out in 2008 made the global economy rapidly turn from prosperity to crisis and recession, which showed that the problems in the economic structure and policies of major economies led to the overdraft of "economic globalization dividend". In other words, the unbalanced structure makes the globalization process unsustainable and sows the seeds of crisis and recession. This is mainly manifested as follows: the proportion of investment, export and consumption in major economies is unbalanced, resulting in a huge surplus or deficit in the balance of payments; In the absence of financial supervision and global financial governance, the flow of highly leveraged financial products and speculative capital has caused turmoil in the capital market and damaged the real economy; The rise of emerging economies and the excessive consumption of developed economies have stimulated the demand for energy and mineral products, resulting in a supply gap and raising prices; The vertical production chain constructed by multinational companies according to the optimal allocation of production factors promotes the transfer of low-end industries, while the development of high-end and emerging industries is weak, resulting in employment problems in developed economies; Developed economies generally adopt deficit finance and expand welfare expenditure, which leads to sovereign debt crisis. It should be pointed out that rebalancing does not mean that the global economic system will return to the split and closed state during the Cold War, but that globalization will enter a sustainable track through structural and policy adjustments. If we think that the global economic imbalance is caused by the structure and policies of major economies under the background of globalization, then the rebalancing of the global economy also needs the coordinated actions of major economies in structural and policy adjustment. The current problem is that in the face of the financial turmoil, the recovery situation and process of major economies are different. Although the United States is slowly recovering, employment, consumption and enterprise investment have not improved significantly, while the ability and effect of fiscal stimulus and monetary quantitative easing are restricted, which will have a negative impact on the future; The European Union (Eurozone) is still in a sovereign debt crisis, and Germany, France and southern European countries, politicians and people have failed to reach an understanding on the solution; China successfully responded to the impact of the financial storm through fiscal stimulus, and its economic growth showed a V-shaped rebound in 20 10. However, after that, on the one hand, fiscal and monetary policies lead to excess liquidity and inflationary pressure; On the other hand, due to the slowdown of external demand, the economic growth that has long relied on exports and investment began to slow down significantly. It has become the main goal of China's macroeconomic policy to curb the rapid economic decline and ensure a soft landing. However, the inflationary pressure brought about by excess money liquidity has not been completely eliminated. This situation has created two problems for global rebalancing: first, how to balance recovery and structural adjustment, that is, to take into account cyclical and structural problems; Second, how to coordinate the rebalancing of the three major economies in the United States, Europe and China, that is, give consideration to internal policies and external effects. These two relations cost each other in the short term, but depend on each other in the long term, because only a good structure can make economic growth stable and sustainable; Global rebalancing can only be achieved if major economies coordinate their actions. For the United States, the deleveraging of government, banks, enterprises and households is the main line of structural adjustment, which may affect the current consumption and investment and needs to be controlled. However, interrupting this process and relying too much on fiscal stimulus and monetary quantitative easing will not help, but will have negative effects, including external negative effects. For the European Union (euro zone), fiscal discipline and reduction of fiscal expenditure are the main lines to solve structural problems. Similarly, it may curb consumption and investment in the short term, but if the root causes are not eliminated, real recovery and sustainable development will be difficult to achieve. As a large open economy, the transformation of China will inevitably play an important role in the rebalancing and sustainable development of the global economy. This is mainly reflected in the following aspects: the transformation will make China's economy gradually return to normal from high-speed growth, and its quality will be improved and sustainable, thus avoiding the blow to the global economy caused by the stalling or derailment of this locomotive that drives global economic growth. The main driving force of China's economic growth has shifted from export and investment to domestic demand and consumption, which is conducive to the balance of payments between China and its trading partners. The opening of China's capital market, the marketization of RMB exchange rate and interest rate and the internationalization of RMB will promote the stable and healthy development of global trade and financial system. In fact, China's economic rebalancing is a problem of changing the growth mode, that is, from the direction of speed and scale to the direction of efficiency, quality, rational use of resources and environmental protection; From excessive dependence on exports and investment to domestic demand and consumption as the main driving force; From manufacturing, heavy chemical industry to service industry (including upstream and downstream services of manufacturing). The decisive factors of these three changes are the transformation of government functions and the perfection of market mechanism. The role of the government should be changed from leading and controlling the economy to providing public goods (including tangible and intangible products) and promoting market-oriented reforms. Qin Xiao is the chairman of Boyuan Foundation and the former chairman of China Merchants Group.