Xi unveils opening-up measures
President highlights commitment to promoting common growth. An Baijie and Andrew Moody report
Chinese President Xi Jinping announced a number of measures on Nov 5 including reduced tariffs and easier market access that aim to promote common growth and build an open global economy.
In a keynote speech at the opening ceremony of the first China International Import Expo in Shanghai, Xi set out China’s plan to boost economic openness and called on the world to promote free trade and facilitate investment.
The expo, which will be held annually, demonstrates to an international audience that the country’s economy is no longer purely the “Made in China” manufacturing powerhouse of recent years but is now driven by consumers who want to buy what the world has to offer.
Against a backdrop of increasing international trade tensions, it is also aimed at demonstrating that China is open for business as the country marks the 40th anniversary of reform and opening-up.
Xi said that in the next 15 years the value of China’s imports of goods would exceed $30 trillion and of services $10 trillion, in step with the increasing demand of Chinese people in pursuing a better life.
China’s initiative to expand imports is not temporary, but a long-term plan to embrace the world and the future while promoting common development, Xi said. Businesspeople around the world are welcome to share the development opportunities of the market in China and its huge population of 1.3 billion, he said.
China is taking solid steps to expand financial opening-up, continue to advance opening-up in the service sector and deepen opening-up in agriculture, mining and manufacturing. The country will also accelerate opening-up areas including telecommunications, education, medical treatment and culture, Xi said.
“China will not stop its effort to pursue higher-quality openingup! China will not stop its effort to pursue an open world economy!”
He called economic globalisation an irreversible historical trend that provides strong momentum for world economic development.
Xi said a fully optimistic attitude is justified toward the prospects of China’s economic development despite the challenges of rising uncertainties and some companies’ business difficulties.
“The Chinese economy is not a pond, but an ocean,” Xi said, and heavy winds and storms “may overturn a pond, but never an ocean.”
The world is facing the challenge of rising anti-globalisation, Xi said, adding that all countries need to acknowledge that openness and collaboration are the engines of global growth and vitality.
Xi proposed that all countries push back against protectionism and unilateralism to build a more connected, fair, transparent and inclusive world economy.
Measures he announced in April on relaxing market access have been implemented, Xi said. China has further simplified the negative list for foreign investment, reduced investment limits and lifted the level of free investment.
Xi said China would foster a worldclass business environment, and he promised to accelerate legislation in foreign-investment law and protect the legitimate rights and interests of foreign-invested companies. Every country should strive to improve its own business environment and solve its own problems, he said.
Xi outlined China’s planned measures to fully leverage Shanghai’s role in opening-up, including setting up new districts of the China (Shanghai) Pilot Free Trade Zone and establishing a science and technology innovation board at the Shanghai Stock Exchange.
The expo shows China’s innovative ideas and actions to support the multilateral trading
China will not stop its effort to pursue higher-quality opening-up! China will not stop its effort to pursue an open world economy!” PRESIDENT XI JINPING, IN THE KEYNOTE SPEECH AT THE OPENING CEREMONY OF THE FIRST CHINA INTERNATIONAL IMPORT EXPO
system and promote free trade, Xi said. Before the opening ceremony he met foreign entrepreneurs and said China will continue to provide a good environment for global investors.
About 300,000 visitors were expected in Shanghai for the six-day event, with the participation of more than 3,600 companies, including 200 from Fortune Global 500.
Leaders of 18 countries also attended.
Sherri He, a partner of the management consultants A.T. Kearney’s Shanghai office, said it is probably the biggest importrelated event ever staged. The scale of the Shanghai expo is much greater than that of the Canton Fair, which has been held twice a year in Guangzhou, Guangdong province, since 1957.
“That would be a comparison point, but that (the Canton Fair) is for both imports and exports. This (the Shanghai expo) is probably the first-ever global import event.”
The exhibitors include a wide range of companies, from those showcasing their expertise in high-end technologies such as industrial robots, machine tools, artificial intelligence and advanced healthcare, to those selling food and luxury consumer goods.
The main goal for some is to get close to the Chinese middle-class consumer, whose growth in terms of numbers is set to be one of the global economic megatrends of the coming decades. The global management consultant McKinsey & Co says the country’s middle class could increase to 630 million by 2022, almost double the current US population of 327 million.
China’s imports are now an important driver of the global economy, with the world’s secondlargest economy being also the second-largest importer of goods for nine consecutive years, making up 10.2 per cent of global imports last year.
China’s imports of goods last year rose to $1.74 trillion, up 16 per cent on the previous year, whereas its exports rose 11.4 per cent to more than $2.21 trillion.
Louis Kuijs, head of Asia Economics for the consultancy Oxford Economics in Hong Kong, said the rebalancing away from exports toward consumption is one of the most important economic trends globally.
“Domestic demand in China continues to grow faster than in the rest of the world, which means imports are going to be increasingly pulled in by China.”
Its surplus with the rest of the world is disappearing, Kuijs said. He forecast that the current account surplus of 1.3 per cent of GDP last year will fall to just 0.1 per cent this year and may soon even become a deficit.
“If it happens, it will be a milestone, and a lot will be written about it. China already has a deficit with some economies and countries in Asia which are part of China’s Asian supply chain involving imports of large volumes of components. It also imports raw materials from countries like Australia. Increasing imports will mean that its current overall surplus will disappear.”
Leon Wang, executive vicepresident, international, and China president at Astra Ze ne ca, the British pharmaceuticals multinational, which is an exhibitor in Shanghai, said: “At a time when China is celebrating its 40th anniversary of reform and opening-up, it is of greater significance for the country to host this international event in Shanghai.
“It shows not only the rise of China under this policy, but also presents a national image that it is open, inclusive and reciprocal.”