Independent Online

Sunday, May 29, 2022

Like us on FacebookFollow us on TwitterView weather by locationView market indicators

Growth of Chinese economy will drive global recovery

The new Ambassador of the People's Republic of China to South Africa, Chen Xiaodong. Photo: Supplied/Embassy of China in South Africa

The new Ambassador of the People's Republic of China to South Africa, Chen Xiaodong. Photo: Supplied/Embassy of China in South Africa

Published Nov 3, 2020


By Chen Xiaodong

According to the data released by the National Bureau of Statistics, China’s gross domestic product (GDP) expanded by 4.9% year-on-year in the third quarter of 2020, higher than the 3.2% in the second quarter.

Story continues below Advertisement

Meanwhile, China’s GDP expanded by 0.7% year-on-year in the first three quarters of 2020. The growth rates of major indicators such as the Fixed Assets Investment and Total Export-Import Volume all returned to positive territory, making China the first major economy to achieve positive growth since the outbreak of Covid-19.

Three factors have contributed to bounce back.

● First, China is the first country in the world to bring the pandemic under effective control. Since the outbreak of Covid-19, China has taken the most comprehensive, stringent and thorough prevention and control measures.

By faithfully implementing such measures as early detection, early reporting, early isolation and early treatment, China basically contained the spread of the virus in just over one month.

The number of daily new confirmed cases had fallen to single digits within about two months. With around three months, a decisive victory was secured in the battle to defend Hubei province and its capital city of Wuhan. Now there are only about 200 confirmed cases in the Chinese mainland.

● Second, China’s macroeconomic policies are effective and appropriate. China has managed to properly balance Covid-19 response with economic and social development. We are promoting orderly resumption of work and production while effectively preventing and curbing the pandemic.

Story continues below Advertisement

From January to August this year, China has cut taxes and fees by about 1.88 trillion RMB (about R4.57 trillion) in support of pandemic prevention and control and economic and social development, allocated 3 trillion RMB for financing small and medium-sized enterprises, issued 1 trillion RMB of special treasury bonds and 3.75 trillion RMB of special bonds for local governments, and encouraged the financial system to transfer 1.5 trillion RMB of profits to enterprises in a reasonable way throughout the year.

● Third, the Chinese economy has strong resilience and large space for manoeuvre. With complete industrial supporting sectors, sound infrastructure, a total population of 1.4 billion, more than 400 million middle-income population and more than 120 million market players, China has the world’s largest market and huge consumption potential, thus providing strong driving force for its economic growth.

The international community is generally optimistic about the prospects of Chinese economy. The International Monetary Fund (IMF), the World Bank and the international rating agency Moody’s have all revised up their forecasts for China’s economic growth this year to between 1.8% and 2.7%, and between 7% and 8.2% next year.

Story continues below Advertisement

In the first nine months of this year, against the backdrop of a sharp decline in global cross-border direct investment, China’s actual utilised foreign capital reached $103.26 billion, up by 2.5% year-on-year, which fully demonstrates the strong confidence of the foreign enterprises in China’s development. The strong growth of Chinese economy is injecting strong impetus into the recovery of the world economy.

Kristalina Georgieva, IMF managing director, believed that China’s strong recovery had provided a “potent stimulus” for the global economy, and created demand for countries that supply it with commodities and supply chain components.

In the first three quarters this year, China’s non-financial direct investment in the countries along the “Belt and Road” reached $13.02bn (about

Story continues below Advertisement

R211bn), up by 29.7% year-on-year.

China-Europe Railway Express saw a year-on-year growth of 30.9% in imports and exports of goods.

South Africa and other African countries will benefit greatly from China’s economic recovery. In the first half of this year, China-Africa trade volume stood at $82.4bn.

China’s exports to Africa, imports from Africa and bilateral trade respectively increased by 3.2%, 16.2% and 8.6% in June compared with the previous month. China’s direct investment in Africa reached $1.72bn, up by 1.7% year-on-year.

New investment covered 46 African countries, 24 of which saw growth of more than 10%. South Africa’s exports to China grew by more than 2% in the second quarter from a year earlier, and China continued to consolidate its position as South Africa’s largest trading partner. China’s open market will bring vast opportunities for development and business to the whole world.

The third China International Import Expo will be held in Shanghai from Thursday until November 10, as scheduled, which demonstrates China’s firm determination to open the door wider to the outside world, uphold the multilateral trading system and fulfil its responsibilities as a responsible major country.

We welcome the active participation of enterprises from Africa and other countries. We are glad to see more competitive products from Africa, such as agricultural products and seafood, etc, entering the Chinese market.

We are now fostering a new economic dynamic with free flowing domestic circulation as the mainstay and mutually reinforced by international circulation. In the post-Covid-19 era, China will further expand domestic demand, advance opening-up at a higher level, and share more development dividends with South Africa and other countries.

* Chen is ambassador-designate of China to South Africa.

** The views expressed here are not necessarily those of IOL.

Related Topics: