China's place at the top table of the global economy is now firmly established. There is nothing that symbolizes this quite so powerfully as the World Economic Forum at the spectacular venue of Davos in the Swiss Alps. This is supposedly where the real economic powers of the world assemble to listen to those who really determine the direction in which the world's economy is moving. And China is undoubtedly one of those leading powers.

The last time a Chinese premier attended the Davos Forum was 2009, when Wen Jiabao had a very good story to tell. Since all the Western economies were reeling from a banking and financial crisis of their own creation, Premier Wen could be excused a degree of triumphalism about the fact that China had protected itself sensibly against the waves of despair washing over most of the West. Six years later, though China continues to prosper on the basis of steady annual growth, there are clearly choppy waters ahead, and China has realized that increased engagement with the rest of the world will be necessary to ensure stability in the next phase of development. Premier Li Keqiang came to Davos this year in the hope of clarifying how China and the rest of the world might be able to align their interests. There is no doubt he was hoping to find some authoritative interlocutors.

Li came well equipped with policy documents; the direction of Chinese economic policy was set out very clearly in the early stages of the present leadership's term of office. It is true that China's growth rate has dropped to levels not seen since 1990, but nobody seriously expected that double-digit growth could continue indefinitely. Li explained that China decided to place stability ahead of maximizing the growth rate to ensure that, if times were to change for the worse, China would experience a soft landing rather than a hard one. China's tight fiscal and monetary policy, along with its traditionally high savings rate, should function as shock absorbers in case of sudden jolts. There are some long-standing negative factors in the background, such as the lack of control over local government debt and the "shadow banking" system, but generally speaking, the country's strong spirit of entrepreneurship and its commitment to innovation should see China through any foreseeable difficulties in the short to medium term.

But there must have been a certain disappointment among the premier's team when they discovered how little the West had to offer. Indeed, how could it be otherwise? In general, the West is in no position to offer long-term or even medium-term forecasts with growth stagnating everywhere, massive uncertainty over the price of oil, the United States almost paralyzed by a bitter two-year election campaign between Democrats and Republicans that has left the president unable to control Congress, and the EU under political and financial stress that might test its institutions to destruction.

Of course, the West put up a dazzling display at Davos with no fewer than 1,700 private jets arriving and celebrities like the Queen's son Prince Andrew – once an official trade envoy though not for the last four years – much in evidence. The largest splash was made not by Western governments, who were probably uneasily conscious of not having much to say, but by the big corporations that provided and received lavish entertainment packages, showing off their power and the degree of their influence.

These groups have little interest in conducting theoretical discussions on macroeconomics or formulating long-term plans for stabilizing global economic structures; they are looking for short-term profits and expansion opportunities. They would have been happy enough to be seen with representatives of the world's second-largest economy to impress their clients with the photographs, but they would not have provided the sober interlocutors whom Premier Li Keqiang came to Davos to meet.

On this front, of course, Western governments and China are moving in opposite directions. China is trying to rein in large corporations and limit their capacity for corruption and the exercise of illegitimate power, whereas the West has more or less given away its directing capacity to corporations who promise their negotiating partners anything they want to hear while taking no responsibility for delivering outcomes.

For large corporations, governments are there to guarantee their incomes and profits, not to direct policy. Many governments in Europe – especially the British government – have already outsourced large areas of government function to private companies that are now trying to establish offshore courts (under the proposed Transatlantic Trade and Investment Partnership) where they can sue governments if their profits are lower than anticipated. If these corporations leech authority away from governments while not accepting any responsibility themselves, who will the Chinese find to talk to, at Davos or anywhere else?

The author is a columnist with China.org.cn. For more information please visit:

http://www.ccgp-fushun.com/opinion/timcollard.htm

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