20th Anniversary of the BFA Annual Conference

The Boao Forum for Asia (BFA) Annual Conference 2021 was held in Boao in south China’s Hainan Province on April 18-21. Currently in its 20th year, the theme of this year’s conference was A World in Change: Join Hands to Strengthen Global Governance and Advance Belt and Road Cooperation. The event hosted leaders from countries in the Asia Pacific, the President of the 75th UN General Assembly Volkan Bozkir and Managing Director of the IMF Kristalina Georgieva. The conference is a non-governmental and nonprofit international organization aimed at fostering regional economic integration which took place both online and offline this year.

Key Economic Indicators

China’s Consumer Price Index (CPI) hit 100.9 in April 2021, rising by 0.9 percent year on year. This increase indicates a recovery in domestic demand, caused mostly by non-food prices such as increasing air ticket and hotel prices as well as retail oil prices. Food inflation, however, remains stable due to falling pork prices as officials work to improve supplies of the meat domestically. China’s Producer Price Index (PPI) leaped to 106.8, going up 6.8 percent year on year, the highest recorded growth since October 2017.

PMI in April

China’s Purchasing Managers Index (PMI) for April 2021 slipped to 51.1 from 51.9 in March 2021. Weakening domestic and overseas demand affected production and short-term disruptions affected the course of economic growth. In addition, the shortage of key intermediate goods impacted the production of industrial goods like cars and home-use electronics. However, consumer demand is expected to pick up and return to normal as a result of vaccine rollouts.

The First CICPE Launched

China’s Ministry of Commerce and the Hainan Provincial Government launched the first China International Consumer Products Expo (CICPE) in Haikou, the capital of Hainan Province. The event took place on May 7-10 and hosted 1,365 global brands from 69 countries as well as 1,263 domestic brands. For visitors of the event, a special incremental duty-free allowance was implemented upon buying items at the expo. The expo aimed to stimulate domestic and overseas consumption as a means of achieving growth. CA

Increasing Foreign Trade

China’s total imports and exports expanded 28.5 percent year on year to 11.62 trillion yuan (about $1.8 trillion) in the first four months of 2021, official data showed on May 7.

This marks an increase of 21.8 percent from the pre-epidemic level in 2019, the General Administration of Customs said.

Exports jumped 33.8 percent from a year earlier while imports climbed 22.7 percent in yuan terms.

The country’s imports and exports totaled 3.15 trillion yuan (about $487.95 billion) in April alone. This marks a year-on-year increase of 26.6 percent and month-onmonth growth of 4.2 percent.

In April, the trade surplus narrowed 12.4 percent from a year earlier to 276.5 billion yuan ($42.83 billion).

Helping Small Firms

China has unveiled a guideline to continue its reward and subsidy policies to boost financing for small and micro enterprises.

Through special funds from the central budget, the country will reward and subsidize provinces where such firms enjoy wider and cheaper access to financing between 2021 and 2023, said the guideline issued by the Ministry of Finance and the Ministry of Industry and Information Technology.

Policies will also be fine-tuned according to the impact on these enterprises from the COVID-19 pandemic and downward economic pressure.

These include raising reward caps for areas which have achieved notable results from fee cuts, introducing preferential policies to the central and western regions, and ramping up verification, the guideline said.

Rising Auto Sales

China’s auto sales rose 8.6 percent year on year to 2.25 million units in April, data from the China Association of Automobile Manufacturers (CAAM) showed on May 13.

In the January-april period, the country’s auto sales rose 51.8 percent year on year to 8.75 million units.

About 516,000 cars were exported in the first four months of this year, up 88.1 percent year on year. During the period, exports of passenger cars rose 89.3 percent year on year to 396,000 units, while that of commercial cars increased by 84.3 percent to reach 120,000 units, CAAM data showed.

Sales of new energy vehicles (NEV) in China increased by nearly 250 percent year on year in the first four months.

Rural Consumption Upgrade

Online retailing is changing the supply structure of goods and services in China’s rural areas and accelerating rural consumption upgrade, the Academy of China Council for the Promotion of International Trade said in the report.

Data showed rural residents are nowadays more inclined to buy home appliances and digital products online, said the report.

Rural residents expanded the sales channel of agricultural products through online retailing, said the report.

In the January-march period, rural online retail sales reached 439.79 billion yuan (about $68 billion), increasing 35.3 percent from a year earlier, according to data released by the Ministry of Commerce.

Online sales of agricultural products amounted to 105.58 billion yuan (about $16.35 billion) in the same period, representing a yearon-year growth of 4.9 percent, the ministry said.

Robust Digital Economy

China’s digital economy maintained a high growth rate of 9.7 percent in 2020 amid the pandemic and global economic downturn, said a white paper on China’s digital economy development issued by the China Academy of Information and Communication Technology.

The growth rate of the digital economy was more than three times that of the GDP, thus showing its pivotal role in spurring economic development, according to the paper.

It also shows that the scale of China’s digital economy reached 39.2 trillion yuan (about $6 trillion) last year, accounting for 38.6 percent of the GDP, which effectively supported epidemic prevention and control, as well as economic development. The digital economy in Beijing and Shanghai both accounted for more than half of its regional GDP.

Last year, 13 provinces, municipalities and autonomous regions achieved a digital economy scale of more than 1 trillion yuan (about $154.9 billion), with another eight regions exceeding 500 billion yuan (about $77.45 billion) in 2020, said the paper. CA

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