Mutual respect key to greater cooperation
Economic future bright
After the PurchaseManager Index, seen as a barometer of the economy, fell to 47 in September for the first time this year and other disappointing data, aroused widespread speculation about a “hard landing” for China’s economy, many worried that China’s slowdown might have a negative effect worldwide.
But President Xi Jinping eased the world’s concerns about China’s economy during hisUS visit, emphasizing China is undergoing economic restructuring and transformation, which might be a painful process but promises a brighter future.
China’s relatively lower GDP growth rate compared with the past high-speed years, comes at a time when global economic growth has slowed and is in accordance with the global economic cycle.
Moreover, many technological breakthroughs have been achieved that will boost quality growth with innovation. In 2014, the State Intellectual Office accepted 928,000 patent applications, 12.5 percent higher than the previous year. In fact, the number of Chinese patents has been the most in the world for four successive years, implying a newcycle of prosperity.
The worry about China’s monetary policies having a negative effect is even more unnecessary. The US Federal Reserve is globally influential because 60 percent of US dollars circulate overseas; by increasing or cutting interest rates, the Federal Reserve can easily inject inflation or deflation into emerging economies. China is pursuing the internationalization of the renminbi, but its currency is not so influential.
Dong Xiaojun is a professor on financial strategy at the Central Party School.