Jeffrey Sachs: The World in 2050 - A Pathway to Sustainable Development27 March, 2024, Professor Jeffrey Sachs, University Professor of Columbia University & President of UN Sustainable Development Solutions Network, gave a keynote speech at the Chengze Garden of National School of Development at Peking University. The event is one of the “PKU Linhu Think Tank International Distinguished Lectures” and “PKU NSD 30th Anniversary Distinguished Lectures”.
It's a great joy to be at Peking University and at the National School of Development. And for me, really a special treat to have the chance to discuss with you the major themes of sustainable development to mid-century. I want to discuss the question of how we can actually achieve global sustainable development, what it would mean and what is required between now and mid-century.
- Why 2050?
We have an agenda of the 17 Sustainable Development Goals (SDGs) that were adopted in September 2015 for a fifteen year period up until 2030. Even when they were adopted, we were not really going to achieve all of them by 2030 because some of the objectives clearly had a time horizon beyond 2030.
But in 2024, we can say that we will not achieve most of these goals by 2030 in most of the world, not only because some of them necessarily required more time than was set for them, but because we have not made the kind of progress needed during the first nine years of the SDGs since they were set. In fact, this has been, of course, a very turbulent period, a very unstable period and one in which even we could say the effort towards achieving sustainable development was thrown on the side as major conflicts arose between major countries, most importantly, of course, the war between the United States and Russia that is being waged in Ukraine today; the tensions between the United States and China, which are extremely dangerous; and of course, the Covid pandemic, which was a huge disruption to the world and remains a disruption.
So in 2024, as we contemplate the challenge of sustainable development, we have to look beyond the 2030 time horizon that was set back in 2015 and think for the longer term. And for me, though 2050 is also a blink of an eye in human history and endeavor. It's probably the right time horizon for us to contemplate how we can achieve what we have set out to achieve in sustainable development.
- How to define sustainable development?
So in order to understand what pathways to success might be, we have to first, define what we mean by sustainable development and what would constitute success.
We have an original definition of sustainable development that was made in the Bruntland Commission in 1987, which said that sustainable development means meeting the needs of the current generation in a way that enables future generations to meet their needs.
It's an interesting definition, because it emphasizes the inter-generational aspect of sustainable development, but it's not a very operational definition because we don't know what “needs” mean. So we don't really know what objectives we're talking about when phrased that way.
I think since that original definition, we have done better in conceptualizing what sustainable development means and actually quantifying what it means in a practical way. So the definition of sustainable development that I will offer to you is —— meeting four core objectives, for global society, for the current generation and for the future.
And those four core objectives are as follows:
1. Economic development everywhere
First, economic development everywhere so that there are the material conditions everywhere for a decent life. And of course, that also raises a lot of questions.
But the first point is to end extreme poverty everywhere. China is the exemplar of a country that ended extreme poverty in a very decisive way between 1980 and 2020, going from a society in which poverty was pervasive and by some estimates, extreme poverty, afflicted 70 or even 80 percent of the population as of 1980 and then reached zero extreme poverty by 2020. So China is the exemplar of what we mean by achieving decent living conditions everywhere.
2. Social inclusion and social justice
The second pillar of sustainable development is social inclusion and social justice, emphasizing that we cannot rely on averages when we measure economic well-being. What we mean is that all parts of society and different groups, whether it's bi-gender, girls and women alongside boys and men, or whether it is minorities or whether it is different geographies in a society, all share the economic progress, the material progress and the dignity of decent lives.
So social inclusion is a second fundamental pillar of sustainable development. And as you know, the slogan of the United Nations is “Leave no one behind”, so that as progress is made, this is progress that is across society. This is also a challenge, and it's a challenge for almost all societies in the world.
3. Environmental sustainability
The third pillar of sustainable development is environmental sustainability. And it really is that core pillar that gave rise to the recognition of sustainable development as a new phenomenon for the world roughly 50 years ago. Before 1972, there was very little attention worldwide to the implications of economic activity on the physical earth. Of course, you can go back to ancient texts where there was concern about deforestation or degradation of the land and the soils and so forth. But the idea that there was a global scale crisis is something absolutely new. And it was not recognized in global diplomacy until 1972 when the first meeting that examine the relationship of global economic development and global environmental considerations took place in Stockholm. And it was in Stockholm where there was a recognition that the methods of economic development had to change to avoid a collision of economic development and environmental management and quality.
Not so much was known about these issues in 1972 as is understood today, but that was the first breakthrough.
For me, it was an interesting moment because it was my freshman year of university in 1972, and the Stockholm conference took place then. And an important book was published that year —— Limits To Growth by the Club of Rome. And it was the first assignment I had as a first year economic student at Harvard University to read Limits To Growth. I was told not to take the book too seriously, and the professor explained to me that the markets will work out these challenges. The argument in Limits To Growth is that we would run out of things and there would be depletion. And since I was a first year economic student, I was taught that if resources head towards depletion, their scarcity price will rise and that will lead to substitution to other goods and to innovation. So my professor told me, don't worry so much about it.
My advice to you is worry for some reasons that I will emphasize, but that is the third pillar of sustainable development.
4. Governance
The fourth pillar is the governance pillar, which is that we need forms of politics that enable us to manage economic, social and environmental objectives in a holistic and in a peaceful manner.
So I say that sustainable development means four pillars side by side —— economic, social, environmental and political. And the political really is political in the sense of expressing the common good and managing the global commons in a way which works for the world through peace and cooperation.
- Why do we need to design new pathways?
So why am I giving a talk about sustainable development this morning? Because we're not achieving anything like what I just described.
So sustainable development is a nice idea. And indeed, when the Sustainable Development Goals were under consideration at the UN, the commission that made recommendations about them entitled its reportThe Future We Want. So the idea is that sustainable development is a shorthand expression for how we would like the planet to be, and how we would like the world to look in the future, whether it's 2030 or 2050. We would like a world of prosperity, a world of social justice, a world of environmental sustainability and a world of peace and cooperation.
A very nice idea, but all four of those dimensions are far from reality.
And this is our starting point to understand the pathway to 2050, which is to understand why the world is not on a trajectory of sustainable development.
Now. The reason is not that it is an impossible objective or there aren't the resources or the know-how for sustainable development because we are in a rich world that has the know-how to achieve these four objectives.
That's my core assertion. The problem is that our institutional design, the way markets work, the way local and national politics function and the way that the global society is interacting, do not lead to sustainable development. There's no invisible hand to use in Adam Smith's expression, which guides us to sustainable development. This is not the outcome of normal market forces. It's not the outcome of normal interaction among nations to actually achieve sustainable development.
If we are going to achieve sustainable development, we need a set of institutions and strategies that we don't have right now in order to achieve sustainable development. And the basic idea that I want to suggest is that we need to design the pathway to the future we want, we need to design it quantitatively as well as qualitatively.
If you're an economist like I am, we need to model that in some way that suggests an analytical framework of how these objectives can actually be achieved. And then we need a strategy of political and institutional change and mobilization to redirect how society is operating to meet these objectives.
So it's three points in one —— the first is to understand what would really be entailed in achieving sustainable development, i.e. the pathways; the second is to understand what an institutional and political framework might be; and the third is something different, which is the question “how does one make social change in a way to redress the shortcomings of our institutions, to achieve something new?” And all of these are very big challenges.
In fact, some people say the third is impossible. “Well, you're just dreaming. Yes, you could design something, but the world is the way it is because of unalterable forces. So don't think that you can change the way the world operates.”
My view is something different. My view is that the challenge of sustainable development, first of all, is something new. We didn't have the challenge of sustainable development in the year 1800 or in the year 1900. It's something new for our time. We didn't have a global environmental crisis, for example, in 1900. We didn't have exactly the challenge of ending poverty in 1800, because everybody was poor. We had the challenge of basic economic development, which was something new in history, but not the challenge of ending poverty, for example. We didn't even have the tools of social justice the way that we could see them now. We had, of course, throughout human history, rudiments of questions of social justice, but we didn't face the kind of gaps between rich and poor that exist today. And the gaps are quite large. The richest 10 people on the planet have a net worth of $1.5 trillion as of the last time I looked at this a few days ago. That's a lot of money for 10 people. And then we have 1 billion people who essentially have nothing. And so we have a kind of challenge that we never had before.
So my optimism, in a way, is coming from the fact that we are not in an unalterable crisis. We are in new circumstances that require new approaches. And I'm a believer that it's possible to make human progress, and we're not stuck inalterably in cycles of war, violence, poverty, degradation, crisis, but rather we can think about our real circumstances and find new approaches to our needs.
And in fact, even the idea of global cooperation is something new. Of course, ancient sages had a basic idea of cooperation in the Analects. Confucius says that “within the four seas, all men are brothers.” So the idea that there is a unity of humanity is 2,500 years old at least. And Confucius probably heard it from somebody else, so it probably goes back even before that.
But in real institutional design, we are only one century of actually trying to have governments cooperate with each other. We've had two experiments. One failed almost immediately, the League of Nations, in its first 20 years; and now we're in the second experiment of 79 years of the United Nations, and it is not so healthy right now. UN is where I devote almost all my time because I believe we need to make this experiment work.
But my point is, it's not as if we've tried this forever and it's failed forever. This is something new. So it's okay to think about new things and what we need now for our current reality. So that's what I want to propose.
Now, just to be clear, the current set of institutional arrangements, the world market economy, which is a very complex mix of institutions, of private corporations, markets, governments and so forth, which I don't need to elaborate, does not deliver sustainable development.
And it's good for us to just reflect on that.
Economic development
First, it does not deliver the escape from poverty for all parts of the world, or at least has not until now. China is a kind of proof of concept in my view that you can go from a billion poor people to no poor people within 40 years. I always say to my friends in Africa, follow what China did so that in 40 years, Africa can also be free of extreme poverty. I believe that. I think what China achieved is a role model for what can be achieved. And it also shows even temporarily, how the pace can be achieved. But the institutions we have now do not achieve this. Africa remains extremely poor on average, though there is variation within the African continent. And poverty afflicts other parts of the world, parts of Latin America, parts of South Asia, parts of Central Asia, and even for places that are not in extreme poverty, there are many places in the world that have a level of income above extreme poverty but that are not achieving economic progress, where economic indicators are stagnant or deteriorating, where there is a ground level of violence in society and a high level of insecurity in society, where investments are not overcoming these crises in any reliable way.
So if a billion people are really trapped in absolute, abject extreme poverty, another billion or even 2 billion people are living in conditions where progress is not reliable at all, life conditions are extremely difficult, disease and early deaths are pervasive, children are not reliably in school and other conditions of human well-being are not being fulfilled or even making discernible progress.
So that's the first pillar. We just don't achieve the economic progress on a sustained, reliable basis. Latin America is a middle income region, but it's been stuck almost at its current situation for 40 years with very little progress. And Africa stuck is even too positive a word for what is afflicting some of the poorest places in the world and so forth.
Social inclusion & social justice:
When you come to the second pillar, markets certainly do not solve the problem of inequality. And there is no invisible hand that promotes a decent distribution of income and wealth. China's own reforms, which I regard as the most successful in the world in modern history, have also generated new inequalities, widening gaps, of course, between urban and rural most famously, and in different regions as well. So even in the most successful reforms, you don't address the social inclusion automatically.
We know now that social inclusion is deeply affected by social institutions, so we need the design of institutions to ensure that there is a relatively manageable and narrow gap between the better off and the worse off parts of society. And nothing in the social order guarantees that minority groups, such as religious minorities, linguistic minorities or geographic regions, automatically benefit, even when an economy achieves a significant development, because the world is filled also with active exploitation of minorities, discrimination and deeply embedded social processes of exclusion.
Environmental sustainability
At the first day of a good economics class, we know that there is nothing in the market system that protects the commons in any way. This is the classic case of external damages. The environmental harms that we face, of which I would say there are three main categories —— the climate change, the destruction of biodiversity and the toxic pollutants. All of those are classic examples of the tragedy of the commons or of negative externalities that markets don't address. If the atmosphere is a free dumping ground for greenhouse gases, well then greenhouse gas damages will not be averted by market forces. They will be generated by market forces if biodiversity is not regulated in some way, forests will be torn down and the commons will be destroyed. And if it is free to dump pollutants into the air or the soil or the waters, then we will end up poisoning ourselves.
All of this is clear. But what is amazing for our time is that this has been happening now at an exponentially increasing rate for the last 200 years. So we have been in a process of industrial development worldwide for two centuries, almost unabated by an active environmental policy. The environmental crisis was recognized 50 years ago, but the global dimensions of this crisis remain out of control until today. Even though the climate crisis led to a treaty, the UN Framework Convention on Climate Change in 1992, and that treaty has been enforced now for 30 years, we are still not even at the peak of the greenhouse emissions, much less driving them down to zero. The emissions themselves continue to rise, and we haven't even stabilized at a high level yet. We haven't even begun to get this properly under control despite 28 global meetings under the UN Framework Convention. We don't have success yet.
Governance
And then the final pillar, cooperation among states, is also not something that one can take for granted. I don't think it's necessarily true that the normal relations among states is a state of war or even necessarily a state of anarchy, as American political scientists say. But it's true that it is not a state of cooperation. So the current global politics shows the failures of our institutions. We do not have an institutional framework of peace among nations, especially among the major powers.
I have my own views about this quite strongly because I personally blame the United States in the current circumstances for many of the troubles because it's the most powerful country and the most arrogant of the countries because of its power. What it really shows is we don't have a framework of cooperation that works.
Therefore, I want to talk about pathways because we don't have them right now. We are not achieving sustainable development. We have a world that is wealthy but with billions of people in poverty. We have a world of rising inequalities within many parts of the world, including my own society. We have a world in which the three major environmental crises are all at a perilous state, none of them is under control. We are not protecting biodiversity. We are not stopping human climate change. We are not reducing pollution yet, even though we have had treaties to do so for decades. And we are not even able to manage basic cooperation between the US and China or the US and Russia and so forth, so we're in a state of war right now that is extraordinarily dangerous.
- Is sustainable development feasible?
How to solve all the above-mentioned issues? The first question is, is it feasible to have sustainable development from a purely material point of view? Do we have the physical resources and the technological know-how available so that all people in the world could live at a decent living standard, and that the global climate crisis could be ended and the destruction of biodiversity could be ended? If so, how would those resources have to be allocated or reallocated?
This is not an empty question by any means. It's not to be taken for granted that one could have economic well-being, social inclusion, environmental sustainability simultaneously. That has to be demonstrated. And there's one body of thought, for example, the degrowth school, which says that this can only happen if the rich countries stop economic growth in some sense, because otherwise there's not enough space on the planet to achieve adequate well-being for other countries. So that's the kind of analytical proposition that needs to be examined.
The 1972 book Limits To Growth proposed that we would run out of key materials and that we would overshoot the economy, meaning that we would have a trajectory where we would reach a peak level of production around now, and then face an economic collapse because there suddenly weren't the inputs to keep the living standards at the level that had been achieved, because of the fundamental depletion.
Some people say that we can't produce enough food for the world population. So the real problem is the population is so large at eight billion people and growing to nine and a half billion people in the standard projection by 2050, that there's no way that all of the world's population could be fed without chopping down more forest, clearing more land and thereby undermining the biodiversity.
Is sustainable development feasible given our technological know-how and our resource base, our population dynamics and the physical earth systems?
I'll give you my answer, but I can also tell you it's a debated proposition that we should work on analytically as scholars, that we need to define all of this more carefully, more quantitatively in a more sophisticated way that builds in technological change in a sound manner.
So my answer is yes. We have the resource base, the land area, the technological know-how to achieve a richer world, a larger population, more social inclusion and an end to the environmental crisis or a very sharp solution to them by mid-century. That is feasible.
Why do I reach that conclusion? Well, without going into all of the details, the main reason is that I do not believe that there is any single limiting factor that is unsolvable or any resource that is so scarce that it can't be substituted in some way in order to achieve our objectives.
For example, some people say wrongly that we have an energy crisis, so we need to use less energy. This is not the point. We have a crisis of greenhouse gas emissions, so we have to emit less CO2 into the atmosphere. And one way to do that would be to use less energy, but that's probably not the best way to address the issue because as you learn in physics in the first day, energy is what allows you to do useful work. Therefore we need more energy in the world, not less, more mobilization of energy.
But fortunately, we're not limited in the kilojoules that we have or the terawatts that we have, but we're limited in how much we can use from fossil fuels. Or even better put, how much we can use from fossil fuels without an accompanying carbon capture and storage technology. One of the pathways we need is a pathway to a sustainable energy system, and this is one module of what I would say is a global pathway to 2050.
I've spent the last 15 years supporting various research programs on what a pathway to energy transformation would look like. The summary of that is that we know quite well at this point how to reach a safe energy system by the year 2050. One way is zero carbon, primary energy, wind, solar, nuclear and so forth; the second way is using fossil fuels in the specific context where you can actually capture and store the CO2, though that is probably not economical in most places compared to zero carbon primary energy; the third way is electrification of transport rather than depending on the internal combustion engine; the fourth way is using non carbon based fuels like hydrogen produced by zero carbon power, for example, hydrolysis, using renewable energy or intermittent energy for industrial purposes or for ocean transport.
That's what I would call the energy transformation. And that can be spelled out worldwide.
And then the question is: Is that a feasible transformation? Do we have enough sunshine for the solar component of that? You all know the answer is yes. We receive roughly 5,000 times more solar radiation than we use in energy. So if we were to tap the insulation more effectively, if our buildings had solar panels on them or if we use the deserts more effectively, there's no limit of land. And indeed, everyone here has seen the little square in the Sahara Desert that if you had that square covered by solar panels and then had long distance transmission, that would be enough for the world. That's not the best way to do it, but it's a proof of concept. You could power the whole world without CO2 emissions in the these manners.
- Pathway to sustainable development —— six transformations
That's the work that I think we as scholars need to do in defining pathways systematically in all of the relevant areas of transformation.
I count six basic areas of transformation where that kind of analytical work needs to be done.
1. Education transformation
The first is education for all. The the most important investment for ending poverty in any part of the world is to raise the basic human capital in the population.
It's, of course, at the core of China's success, which is an absolutely dramatic increase of average schooling, quality of education, number of university graduates and so forth over a period of 40 years, probably the fastest ever achieved for a large society.
The first transformation that I encourage any country is: How are you going to get your children in school? How are you going to make sure that they have a quality education and therefore, develop the human capital that is essential for basic functioning of a 21st century economy that is not stuck in poverty.
It's not a small question because in Sub Sahara Africa today, around 75% of the kids do not complete upper secondary education, and roughly 50% are not achieving more than a primary education. That is dooming those countries to continue poverty because there is no escape from poverty with a population that has primary school level education.
If you ask how much would it cost a poor country to have all of its children in school, it would generally cost more than the entire budget. And so the reason why the children are not in school is typically because the government cannot afford even a rudimentary system to keep all the children in school. And this leads to a poverty trap where children are not educated, the society is poor; and because the society is poor, the schooling is very limited; because the schooling is limited, the poverty replicates across generations. And breaking that school poverty trap is a particular policy challenge.2. Health system transformationThe second area is related to that, and that is a basic health system that functions to prevent pervasive disease, preventable disease, save childbirth, healthy early childhood development, control of epidemics and so forth.
3. Energy system transformation
The third transformation is the energy transformation because the world needs to move to a zero-carbon energy system if the “limits to growth” is to be avoided. We need a lot more energy, but it has to be zero carbon energy. Every country is going to face pretty much the same kind of transformation, including zero carbon electricity, electrified transport, hydrogen fuel for industrial purposes, etc. But getting there has to be analyzed country by country and region by region. Some places are sunny, some places are windy, some places have geothermal, some places have hydro power and so on. And in general, to get to that transformation, these different regions need to be interconnected into a shared grid to reduce the costs of the intermittency of the zero carbon power.
4. Agriculture and land use transformation
The fourth transformation is the agriculture and land use transformation, which is really a complex challenge because it turns out if you add all of the environmental effects of the food sector, that is about a third of all the greenhouse emissions coming from food and agricultural production. It's bigger than the power sector and transport sector in its effect because in the food sector, there are nitrogen oxide, methane, carbon dioxide, etc. all being emitted massively through land use, deforestation, fertilizer use, machinery use and so forth.
Add to that challenge is the fact that half the world is malnourished, which is rather shocking. Diets are unhealthy and unsatisfactory. So dietary restructuring is really complex and important for the world.
And then add to that is the fact that our food systems are not resilient to the ongoing climate change, and so we have to take adaptive measures to protect the food security. One more element is we have another one and a half billion people to feed by 2050.
The food transformation challenge is very big, and we need a major transformation of farm technology. That is as deep and pervasive as the transformation of energy technology. But it's harder in the farm sector because the farm sector has hundreds of millions of poor people using traditional methods that are not reached by advanced technologies right now. Therefore, there's a tremendous amount of social transformation, together with the transformation of the technology itself.
5. Transport and urban infrastructure transformation
The fifth area is transport and urban infrastructure. China has done a remarkable job of creating a nationwide network of transport in a breathtakingly short period of time, and most of it able to be electrified or already electrified because we need and electricity based rather than internal combustion based transport system.
6. Digital transformation
The sixth area for me of basic transformation is digital platforms to support all sectors of the economy. And again, China is in the lead on that. But the point is we need platforms that support education, health, transactions and payments, public services and so on. And for most of the world, this is something new. It's brand new because we didn't even know what this meant 20 years ago; and 10 years ago, it was for a very limited part of society.
But now we understand this needs to be the absolute core base for normal transactions as well as for the management of all major sectors and infrastructure, and this can come very quickly. It's come to China pervasively. The cash economy is basically disappearing. A QR code is the basic mechanism for payments, even for the small vegetable vendor at the side of the path.
- How to realize the transformations?
I believe that we need to plan these transformations even though the private sector and innovation play a very large role. Not all of that can be planned. The basic direction of change and the basic policy framework in these areas, I believe, is a state led responsibility.
I think China has a huge advantage with NDRC that it has a highly effective planning mechanism. But even a five-year plan is not enough for what needs to be done. For example, China has announced that it will reach net zero emissions by 2060. I would make two comments. First, as far as I know, there is no public plan for that, although I hope that there is somehow within government circles something more known. Second, I think it's too slow because this transformation should be accomplished by 2050. And in order to do that, NDRC and related agencies and supported by Peking University and other institutions need to have a pathway, a framework. Not exactly a plan because it's not going to be implemented precisely in a 25 year sequence, but a strategic direction that shows what needs to be done. And then every five-year plan will pick up along the way for this transformation to 2050. So we need a structure, a quantified time bound structure of linking these transformation pathways.
This is something new for government, because this is not how most governments in the world function, by implementing specific programs rather than designing transformation pathways. It makes it hard to achieve these objectives. This is a very complex process that is beyond the know-how of most governments in the world now.
And for most governments in the world, unlike in China, for example, the needed technologies are not within the society. They are to be imported from outside. China produces all of the range of technologies of what is needed for this transformation, but very few countries do so. So for other countries, it's also difficult. How do you make a plan when you don't understand exactly what the technological trajectory is? And this is why we need to make linkages across countries so that we can actually have intelligent, quantified pathways in all different parts of the world.
A second challenge to add is that success for most places requires regional strategies, not only national strategies. If I think of the ASEAN countries, Lao PDR will not achieve decarbonization on its own. Singapore will not achieve decarbonization on its own. It needs to cooperate with Indonesia or with Cambodia. That's true. Anywhere that you look, solutions are trans-border. Regional cooperation is essential.
That is not the norm of governments. Governments may cooperate, but not on core infrastructure usually. But for the transformations we're talking about, this is actual core cooperation that's needed, actual investment on the ground.
The Belt and Road Initiative is important because it is making the physical connectivity across countries. But it requires a new kind of governance, and a lot stronger cooperation. I preach cooperation of neighbors everywhere, and wherever you don't have cooperation, you have trouble.
China should be cooperating closely with Korea and Japan. The United States says no, and tells Japan and Korea that China is the enemy. That's absurd. This is ridiculous, because neighbors need to cooperate.
Africa and China have the same population. China has one country, but the colonial powers divided Africa into 55 independent countries. Africa can never achieve sustainable development 55 separate times, instead it needs an African Union that's truly a union. That is my message every time to the African Union Summit each year, which is you need to be one polity and one integrated strategy to make this work, so that Africa can follow the Chinese trajectory during the next 40 years of rapid development.
- Suggestions
Let me close with two quick points.
What you would find in my view, is that this is a viable transformation that would achieve sustainable development. But it requires a lot of financing to accomplish, meaning that today's poor countries would need a lot of borrowing from the richer countries in order to be able to accelerate the scale of investment to achieve those transformations on the timeline to 2050. To put the children in school and build the hospitals and build the rail and build the fiber is beyond the means of a low-income country out of its current revenues or its domestic saving. So it needs a lot of external finance.
Where should that come from? China is actually now generating 28% of the total world saving good, which can be used to help these countries to finance their development. And they can use China's saving to buy China's products because China can then export hydropower plants, long distance power transmission, BYD electric vehicles, fast intercity rail, Huawei 5G kits and so forth, just what the world needs but can't afford out of current revenues but can afford out of saving.
So my advice is expanding the Belt and Road Initiative markedly, so that we can have China making major exports of cutting-edge technology, then enabling the recipient countries to accelerate their economic development to achieve enough growth that they can then repay the financing in 25 years. This requires one major change in addition to the scale of BRI, and that is to lengthen the maturity of the BRI lending, which averages only 10 years right now, but development takes 40 years. So just like the Chinese government has recently issued extraordinarily long maturity bonds for China's development, China can issue some long term loans for the developing countries, not 10-year, but 30 or 40 year. You will get repaid because then they will grow in China style and generate the income in order to repay China on these long term loans. I would like to see an embolden financial package to go alongside this bolder investment framework.
Final point. All of these requires a tremendous amount of intergovernmental cooperation. We don't have that right now, but I think we have the will for it in most cases.
As I said at the beginning, and I won't elaborate, the biggest problem in the world is the United States right now because the US is concerned about something other than sustainable development. It's concerned about staying No. 1 of the word, which is not a very interesting thing in my view. It’s a naive idea, as the world doesn't need a No. 1 or a leader right now. The world needs cooperation. And the US foreign policy is obsessed with China's rise. It shouldn't be so worried at all. China poses no threat to the United States in any way at all.
I'm trying to explain that to a lot of not-so-sophisticated American politicians. In any event, we need to really help all of our governments, especially mine, understand that the real challenge is not to fight wars, not to expand military alliances, not to overthrow other governments, but actually to sit down, cooperate, and get on with the challenge of making sustainable development a reality.
Edited by: Bai Yao