Building trust remains significant as financial market innovations boom
CGTN's Global Business
The Organization for Economic Cooperation and Development (OECD) has released its latest report detailing the significance of trust in businesses and institutions. Professor John Gong from the University of International Business and Economics talked about the lack of trust in the financial market.
The report said trust is a basic element for well-functioning organizations and authorities in the financial market should try to identify and mitigate risks in their management of public debt. The OECD report also said online markets should offer sufficient information to consumers to build trust.
Gong said trust is an old problem, adding that rising levels of sovereign, corporate and consumer debt are causing concerns in the financial system and market.
"The report mentioned lots of innovations in the financial market, for example, things like cryptocurrency, ... things like algorithm-driven trading... All of these things, these financial innovations tend to propose new challenges and risks to people's trust in the financial market. I think this is something that this report is coming from," he said.
While the trade debate is drawing a lot of attention, Gong said stakeholders are now on the top of the economic business cycle and meeting up headwinds. However, he said the most significant thing from the report is timing.
Gong said financial markets have not fully recovered from the 2008 financial crisis, and there is "another one looming ahead."
"I think it is clearly a very strong signal to policymakers and governments to get prepared for this. You don't want to have such kind of a catastrophic financial crisis as we have seen in 2008, so I think this is more of a precautionary message," he said.