Chinese economy belies scaremongers
The high growth rate the Chinese economy maintained for the majority part of the past four decades seems to have made some take it for granted. They therefore view the 5.2 percent year-on-year growth of the Chinese economy last year from a glass-half-empty perspective.
Added to this, the United States and its allies have been going to great lengths to try and shake the market’s confidence in the prospects of the Chinese economy implying it’s a cause of concern for the world.
Yet China’s economic growth rate is markedly higher than those of other major economies, including the respective 2.5 percent, 1.9 percent and 0.1 percent growth rates of the United States, Japan and the United Kingdom last year, not to mention the 0.5 percent contraction of the eurozone economy over the same period.
None of the latter has caused the same level of hand-wringing as the performance of the Chinese economy, with some China-bashers backing up their claims of the “decline” of the Chinese economy by pointing to foreign direct investment in the country decreasing by about 8 percent year-on-year in 2023. What they don’t bother to mention is that the FDI in the developing countries and the global average in 2023 fell 9 percent and 18 percent respectively. Nor do they acknowledge the cause of that, which is the US Federal Reserve’s interest rate hikes, which have enabled the US to reap the global post-pandemic recovery dividends.
True, the de-risking policies of the US and some of its allies have unavoidably affected the Chinese economy to a certain extent. But that is something China has realized that it cannot sidestep due to the incorrigible Cold War mentality and zero-sum game mindset that prevail in some developed countries. But an economy with China’s size and the level of its connection with the world — China’s GDP was $17.52 trillion last year and it is the largest trading partner with over 120 countries and regions — will not easily yield to the external pressure.
Also, Japan experienced something similar in the 1980s, when it was targeted by the US after it showed the potential to overtake the US in some economic indexes and technology sectors. China has certainly drawn lessons from that.
That being said, what Chinese Premier Li Qiang has stressed in his keynote speech at the opening ceremony of the China Development Forum 2024 on Sunday in Beijing — the recovery of the Chinese economy is strengthening, the country’s high-quality development is accelerating, and the long-term development of the Chinese economy is unchanged — should not be seen as a mere defense of the prospects of the Chinese economy, but a show of the policymakers’ full confidence in the growth potential of the world’s second-largest economy in the future.
Themed “The continuous development of China”, the two-day forum, with its first edition held in 2000, hosted by a major think tank under the State Council, the country’s Cabinet, is a vital platform to promote exchanges and cooperation between China and the global economic and financial decision-makers and the business community. About 400 people attended the opening ceremony this year, including the representatives of international organizations such as the World Bank and International Monetary Fund.
The participants’ positive echoing of Premier Li’s remarks demonstrates that there are those taking a more objective view who also have confidence in the future growth of the Chinese economy. They believe that China, whose contribution to world economic growth remained at around 30 percent last year, has the ability and resilience to make the most of what it has to generate lasting internal growth impetus and new quality productive forces to drive its development.