China picks up baton of world growth driver from US

By Hu Weijia Source:Global Times Published: 2019/8/26 22:06:22

The Chinese edition of the Nikkei Asian Review on Monday published an article highlighting what it calls the first global economic recession in history that originated from China. This represents the popular view that a slowdown in the Chinese economy is a big threat to the world economy.

This is just a new variation of the "China threat" theory, which has long been used by some Western scholars to contain China.

China's economic slowdown is a fact, but the nation is still the largest market for many well-known companies such as US automaker General Motors. The rise of "China threat" arguments around the world also can be taken as evidence that the Chinese market is now an important factor for transnational corporations and one that can determine their destiny.

The Chinese economy is changing faster than expected amid the trade war with the US. 

The era of cheap labor in China is over, so the nation is striving to transform itself from being the world's factory to an advanced industrialized nation. The trade war has accelerated the process as US tariffs push some labor-intensive manufacturers to relocate production to Southeast Asia. 

It is normal to see a reduction in China's imports of some raw materials. Australia, a major producer and exporter of bulk commodities such as iron ore, is likely to be among the first countries to feel the pressure, but this is just a normal part of the adjustment of the global industrial chain. 

China is undergoing a transition as domestic consumption surpasses the export-oriented sector to become the chief driving force of the economy. Instead of worrying about a slowdown in the exports of certain raw materials to China, foreign companies need to work harder to win China's middle-class consumers. 

Sadly, some well-known Western companies are so arrogant that they have a limited understanding of the Chinese market and consumers, as they move slowly in terms of localization. Some companies even have no understanding of Chinese territory and list China's Taiwan as a country on their websites.

Vice Premier Liu He, who is also the top Chinese trade negotiator with the US, said on Monday that China has vibrant micro fundamentals and that the nation's economic growth is shifting gears. Great efforts have been made by China to adjust its economy amid global uncertainty. 

The US has lost the ability to lead global economic growth. If Western companies want to seize opportunities in China, they must follow China's development and adjust.

The author is a reporter with the Global Times.


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