Resilience, openness, high-quality devt: Why it matters to take a holistic view on the Chinese economy
Published: Jan 24, 2024 07:39 PM
Lujiazui Photo:VCG

Lujiazui Photo:VCG

There has been a lot of talk about the Chinese economy, with the Western media overwhelmingly painting a bleak picture. When the 5.2 percent growth of China's economy was announced at Davos, the feedback was mixed. With the US going all out to hold China down, a slowing Chinese economy is perhaps what some want to see. However, as an engine driving global growth, China carries much hope to make everyone better off.

The Chinese economy has worked miracles for the past few decades. It has been contributing about 30 percent to global growth. Despite the slowdown, the expansion of China's economy is equivalent to total annual GDP of a medium-sized economy. The 5.2 percent growth is achieved on a higher basis, a harder task to deliver. Moreover, among all major economies in the world, few are growing faster.

For a global economy beset with weak demand, the market is the most valuable resource. China has a population of 1.4 billion. There is much untapped consumer demand among its 400 million middle-income population, which will double in the coming decade. This is a market that should not be ignored.

Meanwhile, China's demographic dividend is turning into talent dividend. It has abundant human resources in science and technology, and also a large number of researchers, who form an impressive talent pool in the world. 

China is the only country with industries across all categories in the UN's industrial classification. The added value of China's manufacturing industry accounts for around 30 percent of the global total. In 2023, China overtook Japan to become the world's largest exporter of automobiles. 

Back in 2008, when the global economy was in crisis, China adopted a massive stimulus package to boost its economy. However, today, facing economic headwinds, China has chosen a different path. Innovation and high-quality development feature prominently in its growth. China is persevering through various challenges to transform its growth model. 

Chinese companies have played a significant role in this process. The release of Huawei's Mate 60 series carrying home-made chips shocked the market, bringing Huawei back onto the list of top mobile phone manufacturers. This was achieved amid the US tightening of export controls on chips and chip-making machines against China. BYD, a brand once regarded as low-end, is now leading automobile export globally. The anti-subsidy probe launched by the EU is ironic evidence that China's advanced yet cheaper cars have won over European consumers. 

China is also transitioning toward a greener economy. For the first time ever, China's renewable energy capacity has accounted for more than 50 percent of the country's total installed power generation capacity. An IEA report shows that driven by China, global renewable energy capacity added to energy systems grew by 50 percent in 2023. Green development is not just a commitment, but also a vision being materialized in China. 

While trying to do things well at home, China is calling for inclusive economic globalization that benefits all. In other words, China chooses cooperation over confrontation, openness over isolation. During Premier Li Qiang's visit to Europe at the beginning of the year, China extended visa-free treatment to Switzerland and Ireland. The premier met with foreign businesses attending the World Economic Forum at Davos, listening to their concerns regarding data transfer and government subsidies, and committing to address them. 

Thanks to China's continuous pursuit of openness, European companies have thrived in China over the years and continue to do so. In 2023, FDI originating from France, the UK, the Netherlands and Switzerland grew by 84.1 percent, 81 percent, 31.5 percent and 21.4 percent respectively. BMW sold more than twice as many electric cars in the first half of 2023 as its competitors. Despite the political decision of de-risking, European businesses have given a vote of confidence to China's economic future through their actions. 

Harbin, China's ice city in the northeast, has become the hottest destination this winter. With its ice sculpture, winter sports, and enchanting winter wonderland, visitors are amazed by the magic combination of freezing cold and buzzing energy. It is always right to take a holistic view, especially when it comes to something as resilient and complex as the Chinese economy. An open Chinese economy that experiences high-quality development is positive news for the world. 

The author is an observer on international affairs. opinion@globaltimes.com.cn