Fireside Chat with The Hon. Sec. Henry Paulson and Mr. WANG Shi

CCG | June 20 , 2022

【中文视频】

【English Video】

 

With less than tenyears left to meet the targets date of the 2030 Agenda for Sustainable Development, the world needs to pick up the pace and put greater effort into finding better solutions. The environment agenda, core to the SDGs, will depend on the ability of the world’s two largest economies – the United States and China – to find a path toward partnership on climate action and ecological conservation.

June 20, 2022, the Hon. Sec. Henry Paulson, Founder and Chairman of Paulson Institute and Former US Treasury Secretary, and WANG Shi, Founder and Honorary Chairman of Vanke as well as a CCG Senior Vice Chair, had a fireside chat on sustainable development and China-US cooperation. WANG Huiyao, President of Center for China and Globalization, hosted this dialogue.

Wang Huiyao:

Hello, everyone. Good morning, good evening and also good day. I’m Wang Huiyao, founding president of CCG and host of CCG global Dialogue series. You’re watching from online program advancing the 2030 agenda in uncertain times, sustainability and quest for China-US Corporation, featuring the honorable Secretary Henry Paulson and also Mr. Wang Shi. Mr. Paulson served as a 74th Secretary of Treasury under President. George W. Bush from July 2006 to January 2009, as a Treasury Secretary, Paulson led the nation’s response to the financial crisis in 2008, helping to stabilize the global financial system and avoid a second Great Depression. He also designed a strategic economic dialogue to revitalize the way US-China relations was conducted, achieving major breakthroughs on currency manipulation, trade flows, environment and global financial stability. Prior to that, Mr. Paulson had a 32-year career at Goldman Sachs, serving as a chairman and CEO, beginning in 1999, as a banker. As a banker, he grew the Goldman Sachs presence in China. Today, he is the chairman of Paulson Institute, which aims to foster US-China relation that maintains global order in a rapidly evolving world. In 2021, Paulson helped launched and become the executive chairman of TPG Rise Climate, the Climate involve investing platform of global private equity firm TPG. His leadership of TPG Rise Climate reflect his belief that there is an urgent need to accelerate action against climate change, and that innovative vehicles for private sector financing will be essential for meeting the challenge. Mr. Paulson is also a co-chair of the Aspen Institute Economic Strategic Group, co-chair of the Advisory Board of a Bloomberg New Economy Forum. He also chairs a number of leading environments NGOs, including the Nature Conservancy Board of Directors and Asia Pacific Council. Also, Mr. Paulson is the author of two bestsellers. One is On the Brink. The other book is Dealing with China. He is also the co-author of two books with former Chair of FED Reserve Bank, Bernanke and former Secretary Tim Geithner. I would like to also introduce Mr. Wang Shi. Mr. Wang Shi is the senior Vice chair of Center for China and Globalization, CCG. He is the house entrepreneur in China. He founded Vanke in 1984, during a period when Chinese private economy barely started to develop. Under his leadership, Vanke has grown into the world largest residential property and developer by sales revenue and also is the pioneer of China Green Home construction. A devoted environmental conservationist and practitioner of CSR, Mr. Wang Shi has also created and led many influential environmental advocacy groups and charity organizations – chief among them is the Society of Entrepreneurs and Ecology or known as SEE. He had been involved in global climate governance since 2009, having participated in the United Nations Climate Change Conference and other programs. In 2013 he was elected the first Chinese Board Director of World Wildlife Fund. From 2011 on, he studied business ethics and cross-cultural research at top universities in the west, including Harvard. I was there at the same time. He became a visiting scholar at Cambridge University, and the Hebrew University. Mr. Wang is widely known in China for his passion for mountain climbing. He literally set the trends in China for scaling Mt. Everest and Arctic and Antarctic expedition. Mr. Wang is the author of five books. So Secretary Paulson and Mr Wang Shi are all dedicated conservationists, and both are leading a financial and philanthropic course to address the climate change and biodiversity loss. With less than ten years left to achieve the 2030 Agenda for Sustainable Development goes, the world needs to pick up the pace and also put great efforts in finding the better solution. the environment agenda which is called to the SDGs, will depend critically on the ability of world’s two largest economies, United States and China, to find a path toward partnership on climate action and ecological conservation. In less than 60 minutes we are going to tap into their insights on sustainability issues, climate finance and US-China Cooperation. So without a further deal, let me turn to Secretary Paulson first. Mr. Paulson is joined us from Chicago on the evening of June 19th. Happy Father’s Day. So probably Hank you can make the opening statement. Welcome to CCG dialogue.


U.S. and China working in complimentary ways “important”

 

Henry M. Paulson, Jr. :

Let me say I am delighted to see you Dr.Wang again and to be on your program with my good friend Wang Shi. I am a big admirer of Wang Shi, enjoying working with him over many years. Now, in terms of the Paulson Institute, when I set this up in 2011, I set up an independent think tank with the idea of sparking innovation, creativity, economic policy changes, environmental policies changes to help promote sustainable economic growth and a cleaner environment around the world. And my focus was on US-China because I believe then, even though the relationship wasn’t as troubled as it is today, I believed then as I believe now that this is the most comfortable relationship in the world. And here we’re talking about the two biggest economies, the two biggest carbon emitters, energy users. And to me, if we’re going to make progress in these areas, it’s important that we find ways to work in complimentary ways. And so, again, the Paulson Institute was focused on pooling ideas from both countries, developing solutions that would help lead to advanced economic growth and economic policy and a cleaner environment in both countries. Now, you cited the Paulson Prize, and that’s one of our initiatives. And here Paulson Prize is designed to identify in China innovative, scalable programs that can promote the sustainable urbanization and a clean environment. And I think we’ve done a pretty good job of developing best in class programs. And here, again, the focuses on helping for China’s the transition to a sustainable, cleaner economy. And we focuses the prize in two areas, which is a green energy, and a focus on a good conservation. And so that’s a quick overview. And again, it’s something that is very important to us.

Wang Huiyao:

Thank you, Paulson. Thanks for your introduction of the Paulson Institute. We know that actually CCG has supported the Paulson Prize for stability in past years. And I was actually at an award ceremony held at Bloomberg’s forun in the Form in 2019 in Beijing, and you were there. And so CCG was very pleased to become a partner of this program last year as well. So it’s great to see both of you. And I know you are the mastermind behind this prize. And of course, Mr. Wang Shi is a member of the Jury Committee, so I understand that you both recently met in Chicago. So maybe you can tell us how did the synergy come about. So, Mr. Wang, you’re in Europe right now. This is a very great journey in Greece – it’s 04:00 in the morning, your local time. And you and Paulson found relevant activities for sustainable development. You are also a member of the panel of the judges for their prize. Please share with us your synergy and also your recent activities.

Wang Shi:

Having this chance to meet with Mr. Paulson online available start to say that in early May, I embarked on my journey in Europe. And this journey is actually a journey that started in US, from Washington, DC to Chicago, Boston, and all the way to New York on the vessel. And I’m still on the way. And right now, I’m in Athens. Yes, Athens, so this is one of the cradles supporting civilizations of human beings. And right now, here I am in Greece. This is also the place with the very popular activities, some canals. And it’s going to last to the end of July. And the US is very important stop. After Washington, DC, there’s another stop that I’m going to come by in Chicago. And there are five lakes, and the connection of the five lakes and the canals, that’s going to be a very splendid journey as well. New York is one of the biggest ports in US, and also one of the biggest financial centers in the world as well. And I was attending several environmental protection conservation activities and conferences in Boston, and one arrangement is for speed boats racing. And also visited the home of Henry Paulson. And also, that memory impressed me a lot. So, the beginning moment of meeting with Henry Paulson is also very impressive. About 18 years ago, it was about 2004. At that time, Henry Paulson was the CEO and chairman of Goldman Sachs, and very influential financial leader. And I am also a leader in the delegation of a businessman of China. And SEE is the organization I set up, in terms of their mental projection and conservation. Well, both of us have great passions, but of course, we are still lacked experience in terms of the teamwork. We also were very a late starter. So, we signed the strategic agreement with TNC led by Henry Paulson. I still remember that was in the Great Hall of the People in China, and this was actually the official first time we met with each other. We didn’t talk much. What impressed me most was that at that time, at the Wall Street, investment bankers did not put their focus on green technology or environmental protection or ESG. However, Mr. Paulson was very much focused on that, and that impressed me a lot, because he was both a financier and an environmentalist. And over the years, we have been working together with TNC, and our group has grown from 100 business people to over 1,000. And we’ve learned a lot about environmental protection and ecology and NGO governance. And in China, close to 1,000 NGOs have been supported by us, and SEE has become a large environmental foundation in China. Having said that, I’d like to talk about myself. In 2002, I was mountaineering, and I went to the highest peak in Africa, and I didn’t see any snow on that peak. Actually, it should’ve been snow capped, but I didn’t see any snow. The conclusion I came to was climate change and global warming. It is not just that peak. I also went to the South Pole and the North Pole, not as cold as I expected. I remember that when I traveled to the South Pole, I spent 20 minutes without any clothes on my back. And since then, I’ve decided to do environmental protection, and I participated in large global NGO activities. And, Mr. Paulson is always there. And we know that in the United States, there are some large NGO organizations, and Mr. Paulson is the person that can connect those large NGOs together in the United States. So, you ask me how I met Mr. Paulson, he said that he set up the Paulson Institute in 2011. At that time, I was a director of WWF, and some large US NGOs went to the Paulson Institute in Chicago to coordinate their activities.

Wang Huiyao:

Okay, thank you very much, Mr. Wang Shi, for your very impressive story and you’re meeting with Mr. Paulson, and both of you getting involved in environmental actions. It seems that that’s a good case for how US and Chinese entrepreneurs can get involved in the environment. So what I’m saying is, according to the UN 2022 Asian and Pacific Sustainable Development Goal Progress Report, at current rate of change, end of the 17 STG objectives will be achieved in all five sub-regions. So from your experience working in climate action and biodiversity, what are the possible solutions to this? I actually mean, you’ve been advocating for economically and environmentally beneficial market solutions to de-carbonization. What is the role of the private sector in responding to the climate change? What role should financial institutions play? Actually, you know, I was also talking to Larry Summers, he was saying, the World Bank, I mean, AIIB ADB, all the other banks, can play more roles. So what do you think of the private sector? Financial institution roles?

The multilateral development bank work with Breton institutions

Henry M. Paulson, Jr. :

There’s a lot of discussion about the role of the private sector. To me, climate change is the maker, predictable crisis that our planet faces it. And this can only be solved if government in the private sector to work together right. Governments can do research climate, they can say policy, but only the private sector can implement those policies, roll them out in scale, only the private sector. So let’s let us start with the private sector. It seems to me that the private sector…there’s a number of things. First of all, financial institutions, need to do a better job of developing classic financing techniques. They can do stress tests. I think financial institutions need to disclose the impact, positive and negative impact on one so that that is, that’s pretty clear. In terms of venture capital work can do a lot work in terms of and develop breakthrough technologies and get them…That’s pretty clear. They are also private equity firms. I’m the executive experiment of a TPG private equity firm, and they can put capital behind climate solutions that are proven to accelerate the development of those. but you need to begin with the fact that private sector can’t do it without the government policies. It’s going to take trillions and trillions dollars that the governments don’t have. that money needs to come from the private sector, correct? It’s not a sustainable model for the private sector to make markets or investments. They are going to make losses. So the government needs to regulate. I agree with Dr. Wang, but one of the biggest things that needs to be done is to form the Multilateral Development Bank and the Breton Wood Institutions. But there, the governments need to come together to get things chartered, so that these institutions have the financial resources and the technical resources, and the legal framework makes to the work that they need to do. So what I would say right now, is the factor that is well ahead of governments, and that there’s a lot of additional private sector. But if we talk too much about private sector, it takes to focus of what needs to be done, because governments need the political will to put the policies in place, they’re going to let the private sector be successful.

Wang Huiyao:

Great, Hank, I mean, thank you. You made a lot of great initiatives. I think that you have been very dedicated to this thing. I think that we need global business leaders and, financial leaders, and, as you said, governments need to really all work together, NGOs combined, to really achieve a consensus on sustainable development and also efforts to that. Now, I’d like to talk to Wang Shi. Mr. Wang, Last year, you went to COP26 in Glasgow. So what was your biggest takeaway from the conference? For example, low carbon economy? What was your take on the carbon neutral economy in terms of how such an economy benefits both business and the environment?

We’ve witnessed the strength of China’s NGOs on COP26

Wang Shi:

So it’s fair to say that last year, in cop 26 in Glasgow, I was attending that conference, and I also, for the first time, organized the executives, scenic executives of Chinese businesses. And from 2009 all the way to 2019, I was organizing the businessman, on behalf of China’s businessmen to attend the conference in Glasgow, in the COP conferences, including Glasgow conference last year. It’s fair to say that is a very great achievement, and there were a lot of takeaways. And, the number of the conferences and meetings of the COP 26 regarding China is increasing year by year. So, with China senior managers, the conversation was very good, and we reach consensus manners. And the COP 26 is the conference with the biggest number of the attendees, about 25,000 attendees attending the conference in Glasgow. And this is in the official meeting. And of the meeting, there are also a lot of activities surrounding the COP26. It’s fair to say that every day we would see a numerous meetings and conversations being held , including with China’s delegations and activities. And also, a lot of attention has been paid to China as well. That is my impression, and to my biggest impression, or left at the biggest impression to me, for the several years. and last year, due to COVID, we have to get a COVID test every day. And all the organizations and countries delegations are very passionate about the conference. And at COP26, a Tropical Forest Protection Declaration was issued. And we have to wait and see the final achievements, and how such a conclusion was reached. And so, we need to see how actions were taken instead of just lip service. And at the same time, we feel that, although we know there are a lot of imperative issues in front of us, but still, we have to strike a balance in the difference in the interests of different stakeholders. So, an agreement reached by all stakeholders is very difficult. Nobody knows what will come until the last minute. So this is really available and a hard earned declaration in the end. For example, US, China and EU, the conversations and explorations on the future solutions for cooperation is always continued. And without participation by either one of them, one might as well not even talk about the collaboration in the end for the climate issues and many other issues related to this. But still, I’m very positive about this outcome. China’s businesses and China’s businessmen or entrepreneurs also have expressed of their feelings and opinions at COP26 and they have shared the stories of the four decades of reform and opening up in China. And in the first two decades, China mainly saw rapid development, or the high growth rate of the economy. And so that has been acknowledged by the world. And in the second two decades, activities of low carbon development were also initiated and embarked on. Private businesses initiated the journey, and state owned enterprises initiate their own journey, and they combined their journeys together, and I mean private sectors and public sectors, and they combined their efforts together. And that’s why the environmental conservation and natural conservation have made a lot of achievements. At the same time, the government and private companies and public companies, they have to join hands together, just alluded by Mr. Henry Paulson, that the passion and also the endeavors need to be generated, especially by private enterprises. So the consensus and also the declaration and achievements raised by stakeholders and governments at the COP26 conference is very important, especially on the climate summit and also in the climate related conference. China needs to demonstrate some futures and also demonstrate its own achievements as an example to other countries. And also, we also need to have other countries to know our own futures and traditions as a foundation for further collaboration between each other. So I think more and more, we will see opportunities like this. China’s NGOs are also becoming stronger and stronger. We have witnessed their strength at COP26 as well. In the past, NGO participation was not that strong, but at this Cop26 we have seen strong participation and efforts made by Chinese NGOs, which have become one more influential. And the third positive takeaway is that the youngsters are the future of for all kinds of endeavors. We have also seen the jointly launched United Coalition of Universities, launched last year. And this is also very important to demonstrate the strength of youngsters graduating from universities as well. We have also seen the organizations organized by university students and young scholars, and they made a lot of speeches at the COP26 conferences as well. And we have had activities, both online and offline, participated in by a lot of young scholars and students from universities and colleges. I think the journey ahead of us is full of bumps, and China has a long way to go. Dual carbon goals of 2030 carbon peaking and 2060 carbon neutrality are in front of us, of which is very arduous. And China is 2060. And other advanced countries are normally 2050, 10 years left behind. Probably we can set the deadline a little bit earlier than scheduled, but I think 2060 is a realistic deadline. Even 2060 is very difficult for us, but at COP26, China’s delegates made commitments that we would try our best before 2060, carbon neutrality will be attained by China, and this is the realistic target, and we’ll try best to attain that target. So I think this is really good environment created by all delegations, and this is also very positive to push forward and promote the future initiative. And China’s NGOs and Chinese organizations played a very big role. As for my participation, on my part, I’ve expressed that I not only on behalf of my company, my group, but also on my behalf of the different sectors and industry of China, like the real estate sector. The real estate, or housing sector, accounts for more than 10% of the carbon admissions in manufacturing. In terms of the building materials for the commercial buildings, or residential buildings and school buildings, and all kinds of buildings, the carbon emission in the building materials account even bigger about 30% to 35% of total urban development, compared to advanced countries. This is a bit bigger. So although this trunk is very big, still, we are on the way to solve it. At the COP26 conference, we made it very clear that we’re going to make very clear plan and also clear targets to attain before a COP26, standard express it on COP27. And right now, we are on the way of further carbon basement in urban development, in the building of infrastructure and housing. So COP26 is not only the demonstration of actions, but also the commitment that we are going to prepare for COP27, and we are going to launch our plan in the near future. Thank you.

Wang Huiyao:

Thank you. I can see what Mr. Wang just said. It is very important to have private sector, business sector and government, to work together to achieve sustainable environment objectives, including carbon neutrality. So, Mr. Wang, you emphasized the importance of business government, and also NGO. So that’s a great example what you have experienced at COP26.

And what I think, actually is very useful that you also mentioned business and mobilization. China is … now the business sector, for example clean energy, Tesla is doing fabulous in China. And wind power, solar power, in all those things that China is leading, probably in a world, to some extent. But it also mentioned about real estate sector, where Vanke is a big one of large developer real developing in China. And actually, you mention about the 30-40% that carbon emission could be done and be saved through real estate development. So that’s really great stuff to talk about.

Now, I would like to talk to Secretary Paulson. You know is that the biggest challenge, actually, for achieving the 2030 agenda today, lies in our fragmented multilateral system. It is unfortunate that the United States and China, particularly, the world’s two largest economies have a lot tense strategic competition. Also, Secretary Blinken recently mentioned the competition as well. So Mr. Paulson, you mentioned about economic iron-curtain really drove the message home some time ago. So, climate changes in the area of US China cooperation, that holds real potential. And, and both Secretary John Kerry and Minister Xie Zhenghua, the two Climate Envoys appointed by President Biden and President Xi, spoke to each other at Davos and COP26, and reached an agreement that John Kerry actually even attended all meetings at the Secure Conference about two years ago at CCG.

So what do you think? I mean, how the US and China relations go forward? I mean, what are the possible paths for cooperation for the two countries, in the midst of competition? But then there’s a climate change. There’s a finance crisis, recession, high inflation, people-to-people exchange, global development. So what’s your overall assessment for the sign of US-China Cooperation? And what are the chance we have to face?

Tariffs don’t make economic sense

Henry M. Paulson, Jr. :

OK, I think I got both of that. So let me begin by saying, I think there’s no doubt that two countries are large strategic competitor, and I think where competition are across really all of domains, you know, technology, finance, economy, military and ideology. But despite that, our two countries have the common goals, we have some shared interests. We need to have peace, stability, world order, stable climate, right? And so we have shared goals. And so, question is, how can we cooperate at the same time we compete? And, I think there’s a number of areas that are important.

Citizen citizen exchanges are very important. I mean, the work that Wang Shi and I have done over the years, what I found, even though a very different culture and political system, that Chinese and American people like each other. We have an opportunity for each other. And I think some has been hampered by Covid right? I have been able to travel to China since 2019. Many business people that were in China have not come back as a result of Covid. So I think that’s important.

Climate change, obviously, is another area, and that is area that our two presidents have designated as an area where we should work together. We’ve got groups working together on, you know. I think another thing is climate. I think this is made more difficult by the … I think about areas where we should be working together, and I think it’s important to both countries that we do that and enter…because we are the biggest climate of matters, right? China is by far the biggest measure of carbon emissions, and the US has only 4% of the world’s population for 11% to 12% of carbon emission right? So, both countries have got a real need to work together. I here’s what I think we should be doing:

First, we both should be doing more research and developing the breakthrough technologies we’re going to need to avoid climate disaster, except with the harder technologies we need to do. So that it is clearly where we should work together. I think we both should work on lifting and eliminating tariffs and environmental goods or services. Makes no sense to charge tariffs on environmental goods and services right? Does it make technical sense and economic sense to pay more for the environmental goods and services? We need to cooperate more. We each need to provide incentives to channel private sector money into developing and rolling out in scale the technologies that we need to reduce carbon emissions. I think we both can do more to share knowledge and make sure that we deploy the key technologies in each of our countries. This may require some concessions on both of our government’s part, but I think that’s very important.

And I think we need to develop clean technologies. And I think we need to really work to accelerate the reduction of carbon emissions in emerging nations. Each of us can do that, right? Just looking at the Brick-And-Roads countries, they’re responsible for 28% of carbon emissions today, but by 2050, it could be 60 %, if we don’t do something. So that we can work there.

And lastly, I’m going to come back to the point that you mentioned that Larry Summers said, which is when we look at carbon governance, global carbon governance, because, to me, it was inspiring, really inspiring to hear what Wang Shi was doing, and everything China was doing and Wang Shi has done. That’s very, very necessary, but it’s not sufficient, right? So right now we are, even if we met the Glasgow targets, the global overheat. And we’re not coming, we’re not even close to being on a path to meet those targets, right? And so I think we need a different approach to climate government, and we’re not gonna get anywhere unless we see the US, china, India, the other big countries doing more, doing more at the government level to incentive industry. So there’s a lot we can do.

One area where we can work on together is…on the Belt And Road, for instance. And the Paulson Institute, my institute, is working with the Green Principles. We were the 1st US institute to join into that effort. That work with state green development principles for the for the Belt And Road. I think, in working with multilateral development banks, to Paulson, who is working with the Asian Infrastructure Investment Bank, which are doing some very interesting things there. But I think all multilateral development banks and the Breton Woods institutions need to do more, and we’re not going to do more unless the governments come to come together to give them the capacity and the finance support of the need, as though this is an area where US and China and the other major countries of the world need to cooperate and work together. So there’s a lot to be done.

I’ve got to be honest in saying there’s not nearly as much being done as should be being done, and that has to do with in other strategic competition and the nature of the fraught relationship between our two countries. But I come back again to say, there’s nothing wrong with admitting we are strategic competitors, and we’re competing in all these areas. But we also need to acknowledge both countries have shared goals. We need peace, we know it, we need prosperity. We need a global order that works. And we need to save our planet, because climate change is a threat not only to economic security, but global stability, life on Earth, we all know it. So I believe that we have a saying in the US that necessity is the mother of invention, right? And I am under believe that necessity is going to bring these two countries together. And again, I look forward to the day when we can travel freely, and I can visit China, and we can have more interpersonal relations. Because the reason I set up, part of the reasons I set up Paulson institute, is I knew there are going to be tough times between our governments, Beijing and Washington DC.

Now, I didn’t predict it was going to be as tough as it is now, but they’re going to be tough times. And I think we need other linkages, people to people linkages, economic linkages, NGOs working together, people working together to solve. And that’s why I think the work that Wang Shi did, bringing the big delegation from China, the Glasgow to interact with all the other leaders around the world, is so essential. So I say, thank you to Wang Shi.

Wang Huiyao:

Great. Thank you. You are absolutely right. I think we need multiple linkages and exchanges and dialogues like this, and particularly face to face dialogue that we hope that you can come. As soon as we we lifted all those quarantines. And you mentioned about, this critical component of cooperation between China and US, particularly, I highly support your idea. On the tariff for those environmental sustainable development products, we should really leave the tariff, sanctions, particularly now we are facing such a high inflation.Also the food crisis, energy crisis, Ukraine-Russia conflict.

Henry M. Paulson, Jr. :

That’s a different issue. And I think the US government is looking at reducing those tariffs. I’ve said from the beginning that most tariffs don’t make economic sense, not good for either country and as attacks on US consumers, and it is not good for trade. But I was making a different point. I was making a point that there had been long standing tariffs in environmental goods and services. And there I think China needs to do more. Because when we’ve tried to get people together and at the WTA and do things with the WTO and elsewhere, the lift environmental goods and tariffs on environmental goods and services, there, China has been resistant to eliminating those tariffs. So I think there’s more we could do in these areas. And I know they’re politically competition, and I know that the competition and economic competition is to make it more complicated, but I think that the fight to save our planet is more important.

Wang Huiyao:

Yeah, absolutely. I think we need to do both on both sides, to leave tariff. I think the statement we made here is great. But also, you mentioned about the Green Belt And Road. That’s very interesting, you have helping setting the green standard on that. And also Biden has proposed B3W, and EU established Global Gateway. Green infrastructure are probably the need for the future, and we should probably all work together on that.

Henry M. Paulson, Jr. :

That’s that’s extremely important, because the world needs hundreds of billions of dollars, maybe trillions of dollars, in infrastructure. But how that? And no NGO likes to see infrastructure. You know, they’ve never seen a dam they like, they never see a road they like, never seen a railroad they like, never seen an oil well… But they all can be done in ways while there’s less damage on the environment. And that’s another area the Paulson Institute looks to work with organizations. And I think every development bank, including the China Development Bank, Hangseng Bank, all the development bank, can do a better job of planning in advance, rather than writing impact statements after the project has already been to harm the environment. They plan how to build the infrastructure so as to do as little damage as possible to the environment.

And, we haven’t talked much about the biodiversity crisis, but I see the biodiversity crisis as being everyday alarming to the climate crisis, because two of them go together, but the climate crisis is tolerating… biodiversity and vice versa. And you’re seeing species extinction on Earth at a thousand times a natural rate. So at this rate, 50% of the all species on Earth are being extinct by 2050. And so in many ways, this is even more alarming than climate change, because with climate change, we understand the science behind it, and we understand what we need to know. But in terms of disrupting mother nature, we don’t even know what we don’t know. And so I think it’s alarming. And so there the key thing we not needed to do is protect the environment and not destroy it.

We can do some simple things that the financial institutions do, and in terms of our egg subsidiaries and fishing and in timbering as subsidies in those areas. So there’s a lot we can do. China has done a lot in China. I think there’s a potential for China to do more outside of China, looking at the biodiversity, but there’s a potential for all of us to do more. And so this is again, another area that where there is a global crisis, which I hope really brings people together. And I think Covid has led people to focus more on mother nature, right? And so I think that may be an incentive. But again, this is an area where Wang Shi has been leader, and work that he and his foundation have done in terms of restoring mangroves, for instance, which are vital to the ecosystem, protecting coastlines and nurseries for fishes and so on. And he also been a leader in this area in China, and we’ve been pleased and honored to work with him within China on biodiversity conservation.

Wang Huiyao:

Okay, Thank you for you remarks. Absolutely, the corporation between China, US on all those development banks, infrastructure and biodiversity, are absolutely crucial. Thank you again for that. And actually, my staff was telling me we are almost closing, but, but we actually had, you know, multiple channels online, almost half a million viewers of our dialogue. So to conclude, I would like to have both Wang Shi and and Hank for you for closing remarks. You know, how can we, you know, particularly from business community, NGO sectors, can we work together between China and US on those common challenge facing the world? And how can we work better in China the U.S. in terms of those common challenges facing a humankind, climate change, the biodiversity, and of course, all those future catastrophe, economic recession. So perhaps Wang Shi can conclude that. And can I have Secretary Paulson to conclude after you.

Stay Humble in the face of Nature

Wang Shi:

Um, Thank you. I was listening to the presentation made by Mr. Henry Paulson. I felt the same thing regarding how to better facilitate the cooperation and collaboration between US and China in the future for the common challenges faced by human beings. As a leader of NGO and leader in a business community in China, I think after China joined the WTO, China has been regarded as a market which was open. And at the same time, China is also a very important bridge between the different streams of the flow of the commodities and services.

So as a businessman, from the business environment, it’s fair to say that from the beginning of free form and opening up all the way to now across all systems of finance, commodities, development and trade, in everything we have seen. The interrelated world between you and me, between different countries and different stakeholders. Actually, after 50 years of journey of this visit, be it in US or Europe, the MMCs, corporations and SMEs having relations with Chinese enterprises, especially SMEs, is very important. MMCs have their organizations and operations in China already. For SMEs from other countries, that their relation withs Chinese businesses is really valuable, especially against a background of Covid, against the background of the current challenges in the supply chain, especially, as we have seen the lockingdowns and disruptions during this year.

So, it’s really hard, a very hard time, and like the business of China, for them, is very hard to get out and afford those business in other countries, hard for them to get in China. So from the emotional perspective, from the business perspective, it’s really hard times. The connection is very important, and we have felt a lot of disruptions in the connections between each other. So the conflict does not come from trade barriers, or the tariffs, or the trade conflicts. Not that. It’s the Covid pandemic. We have had the same expectation that after Covid is over, we can be connected and reconnected together.

So, everyone is actually prepared for that moment to come. We couldn’t wait for that moment to come. So after so many years of the connections, other countries, especially tourist countries, who got used to a numerous Chinese visitors and tourists coming to their territory to visit, and they earn money also in the end. And right now, there are a lot of disruptions and a blockages of travel, the banning of travel, which leads to the disruptions of their income in these tourist countries as well.

So a lot of countries are really in the great need of Chinese investment, the international investment and international assistance in some developed, less developed countries is also very important. So we need to reopen and in terms of, for example, clean energy development, like wind power, development of batteries and energy storage. And we have felt that these countries are in need of China’s investment collaboration. And China’s companies recommend to a reside over there to cooperate with them. So the climate is coming warmer, this is one issue. Cooperation is very necessary, and this must actually expand beyond the need for conflict. We have to join hands and we have to set aside the conflicts of interest.

Like Paulson has said that protecting biodiversity is equally important as climate change issues. I agree with him. And we have to stay humble as human beings, in the face of nature, in front of the biological environment, because we are yet to know the full picture of the influence or impact of the climate change to biodiversity. And we have to wait and see. And we have to take initiative in preserve the nature in advance, no matter what happened in the end.

And also, we have to explore the common way to all the common solutions, so to protect about diversity, which can benefit all of us, especially after Covid. So the biggest imperative of humanity, I feel, is the initiative taken by China, US and EU countries for common development and common prosperity. But I think the three parties are the most important US, China and EU. These are the three most important force for NGOs. So cooperation is also the core issue for them. And above which, we have to set aside the impact from the Covid. And we have to reconnect with each other. Thank you.

Wang Huiyao:

Thank you. I think that’s very important to have these exchanges between business, between the people and travel in all boundaries and keep the bridges and flow. So Secretary Paulson, your last word, on how the US China business, and government, and also with other countries, to work together for facing the common challenges.

Henry M. Paulson, Jr. :

Yes, so I won’t repeat a lot of things I said earlier. I’ll begin with the governments. And I really do think our governments are communicating. It’s good that they’re communicating. There’s communication at a senior level, but there’s a lot of communication that isn’t taking place. And so I think at the government level, I just recommend that they do things together. The simpler and easier to learn, so we can, so we can build on success.

And all those are the communication, perhaps the strategic and military area to avoid conflict, and it is very important. Communications from the macroeconomic policies, is one thing that this recent period, as pointed out is this great irony, just at the time that there’s more trouble between our two countries, more competition, of more fraught relationship. It’s clear and how interdependent we are. If there issues in China, economic problems, or Covid lockdowns, and impacts, what happens in the US economy? If there’s something in the US economy, it impacts China. If we have another global financial crisis, wherever where it will start, it will impact both countries.

So we sure need communications about macroeconomic policy at a senior level. And then I think climate change, I outlined all the things it should be done. We know those things aren’t going to be done right now. They’re just not. So realistically, we have to do some simple things. The working in group, that’s been set up with John Kerry and his counterpart, working on methane, or whatever the issues are. And to get some simpler things done.

And then I come back to the private sector, because I can be very negative, even if I get outside of Goldman Sachs, if I get outside of what’s going on with the between the United States and China, all conflict and our relationship. Just looking at globally, we’re not doing the things we need to do to meet the climate crisis. But the good news is what you see in the private sector, because what we’ve seen is due to a lot of innovation there, we’ve seen the cost of renewable come down, so they’re competitive, right? So, in half the world economies, if you have scalable wind or solar, it’s competitive with and in many cases, better than coal, or gas. And so we’ve seen that number one, and that’s a big positive.

And then what we’re seeing is we’re seeing financial institutions are putting pressure on companies to action. Their investors are, and their customers are, the people are, the American people, the Chinese people around the world want to see product. And so businesses are innovating at a faster rate than I’ve ever seen. And I’ve probably talked in the last year with the CEOs of 80 global companies from all over the world, and if I talked with those companies two or three years ago, they say, “we’re the best at environment and climate change, talk to my sustainability officer, I want to talk to you about US-China relations, or what’s going on with the economy today.” They’re all focused on climate change, and so they’re making progress. And so I think there will be opportunities for cross-investment in this area and for companies to continue to make progress. And so that’s where it is.

But right now, I think that there’s going to be a limit to what we can do and to make a lot of progress as long as, the Russian and Ukraine, and Russia has continued to invade Ukraine. So I think that’s going to be that. That’s going to be it. You know, that’s doing a lot to disrupt the global economy, but overall, there’s plenty of things we can do. And it’s very good and applicable that you had Wang Shi on this discussion. I think a lot what is going to be done is going to be done by the private sector. So thank you for this opportunity.

And it’s always good, you know, we can see some of the problems we’ve had, even with technology today. But I look forward to the day when I can travel to China and see all my friends again and have face to face communication. And with my colleagues at the Paulson Institute, I had a zoom call with them again this Monday and thank them for all the work our Chinese colleagues are doing in China, in Beijing and Shanghai, but I haven’t seen them in person now in a couple of years.

Wang Huiyao:

Okay, great. Thank you Secretary Paulson. Incidentally, you said at the your closing remark, I think absolutely, the government is important. They should increase the level of communication and dialogue, absolutely so crucial. And you emphasize that business is crucial. I mean absolutely important with all the multinationals, private sectors, like SMEs and all the NGOs. So that’s great, a message both of you have online today. I really appreciate all the a great contribution you’ve made. So that’s all the time we have. We were going to conclude this special dialogue series of the 8th the China Globalization Form. We’re having another 20 ambassadors round table next. So we have to stop here. I appreciate all your contributions. Thank you so much. See you next time.

Note: The above text is the output of transcribing from an audio recording. It is posted as a reference for the discussion.