The participants in the Gaidar Forum 2013 were unanimous that the world is on the threshold of big change. Over the past 30 years, the world economy has been relying on workforce from South East Asia and has been developing thanks to the ensuing consumer boom and rising commodity markets. This model is no longer relevant, Professor Jack Goldstone of George Mason University, says.
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Asian, European and American economies are all in for structural changes. As for Russia, it will have to step up modernization of its economy as it will also face changes, the professor said.
Addressing the Gaidar Forum, Russia’s Prime Minister Dmitry Medvedev said that there were new opportunities and new models lying ahead.
"The economic crisis of the 1970s led to the creation of a new model and the appearance of two major reserve currencies. Consequently, it gave new impetus to globalization – a major feature of contemporary development."
The crisis of the 1970s produced a bi-currency model – at first dollar-Deutschemark, then dollar-euro.
Given that both currencies are going through hard times at the moment, experts consider alternative options. Nobel Prize-winning Canadian economist Robert Mundell suggested a supranational currency – ‘device’ – which would be a combination of the dollar, the euro and the yen. This currency should not be tied to any country if it is to meet the interests of all countries, Robert Mundell said.
Mikhail Delyagin of the Institute of Globalization, comments.
"The dollar, the euro and the yen lean on three different economic models with different rates of development. A system of management that would involve Japan, the United States and Europe, is impossible. Mr.Mundell’s suggestion reflects the ‘death’ of the old model. The dollar is no longer capable of performing the function of a reserve currency."
However, experts don’t see any alternative to the dollar. Only the euro seems to satisfy global requirements. But a supranational currency would require trust in international financial institutions, which, in the opinion of Bulgarian Finance Minister Simeon Djankov, are falling into decline. The IMF, he says, has failed to cope with the eurozone debt crisis.
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Russia has drawn a lesson from the crisis – it recognized the need to reduce budgetary spending and reform the budget sector. The result is the so-called ‘fiscal rule’, Russia’s Finance Minister Anton Siluanov says.
"The ‘fiscal rule’ enables us to make forecasts for the future and understand the Russian budgetary policy – what expenditure we can afford and what we can’t."
According to Anton Siluanov, Russia will try to address a wide range of economic issues, including state debt, budget and unemployment, during its G20 presidency this year. Prime Minister Dmitry Medvedev underscored that Moscow would urge G20 nations to pursue the policy of cementing economic growth.