Stressing the need to improve infrastructure, the expert said the Belt and Road Initiative is very helpful and positive.
"It's good for China and countries in the region and will help to increase the growth," he said, "The key is the region needs infrastructure. It's an important project to build connectivity in the region."
INTERNATIONAL COOPERATION
According to the recently unveiled 13th Five-Year Plan (2016-2020), China has vowed to actively participate in international cooperation and global economic governance.
That includes the expected inclusion of the Chinese yuan or renminbi (RMB) into the International Monetary Fund (IMF)'s Special Drawing Rights (SDR) basket of currencies, the establishment of the Asian Infrastructure Investment Bank (AIIB), and promotion of bilateral and regional free trade agreement negotiations.
"I expected the RMB to be included in the SDR," said Savage, "Over the last five years, the RMB has become an important currency for global trade settlement."
According to Hormats, China's effort at the internationalization of the RMB is beneficial to global economic, financial and monetary systems. It is also very important for the country to work with the G20 at the central bank level and with the IMF to ensure a smooth transition.
"We want to avoid volatility in exchange rates in general," Hormats said, "Finding a way to stabilize the currency environment would be very positive for China and other countries."
The expert also pointed out that a potential bilateral investment treaty between China and the U.S. will help companies of the two countries feel more comfortable to invest, which is good for both economies.
GROWTH EXPECTED TO ACCELERATE
"The key point is it's important that China grows at a strong rate, the prosperity of China is important to the global economy." Hormats said.
Commenting on China's reform, the expert said its direction is very positive. "More market-driven economy of China is good for the global outlook, and other countries of the G20," he said.
China's consumption will continue to outperform the rest of the economy, said Andrew Polk, Asian economist of the Conference Board.
In Polk's projection, starting in 2017 China will have an uptick in economic growth due to higher investment as a result of high-level packages such as the Belt and Road Initiative and AIIB.
Savage highly expects global economic growth to come back in this environment, amid potential stimulus and extremely low interest rates. "I am optimistic that 2016 will be better than most people forecast," he said.
