Home > Latest News
Consul General Tang Zhongdong Published a Signed Article under the Title China's Positive Economic Growth Lays Solid Foundation for New Development Pattern
2020/12/11

On December 11, Consul General Tang Zhongdong published signed article in Star and Business Day unde the title China's Positive Economic Growth Lays Solid Foundation for New Development Pattern, introducing the achievements made by China in the post-pandemic era and its background, and clarifying that China is undergoing an open and new development pattern, which provides more development opportunities for its neighbors as well as the world. The full text is as follows:

China registered its economy growth by 4.9% year-on-year in the third quarter, turning it from negative to positive for the first time in 2020, thus the GDP of the first three quarters grew by 0.7% year-on-year. Based on the combined elements including rebounding demand, continuous improvement in the industrial cycle, production, market confidence and vitality, we are confident that China's economy has got favorable conditions to maintain its current momentum throughout the whole year.

Due to the unprecedented COVID-19 pandemic, China's GDP contracted by 6.8% in the first quarter of this year. But the second quarter saw an effective control of the spread of the pandemic and increased efforts to resume work and production in China, with a single quarterly increase of 3.2% year-on-year, while the total economic output in the first half of the year fell by 1.6% year-on-year. Positive growth in the third quarter was particularly noteworthy at a time when the pandemic was ravaging the world.

The International Monetary Fund (IMF) forecasts that China's economy will be the only major economy to grow this year. It will grow by 1.9% in 2020 and 8.2% next year, versus the world economy will contract by 4.4% in 2020, the US economy is expected to shrink by 4.3% and the euro-zone by 8.3%.

Some western media commented that while much of the world was still battling against the virus, China made a relatively rapid recovery, which was beyond imagination for the rest of the world. Furthermore, unlike those countries that had adopted super-easy policies to save their economies, China's stimulus measures had been much milder. The rapid recovery has not only brought confidence to China, but has also benefited the world economy, especially those industries and businesses with strong links to China.

Globally, China is at the forefront of COVID-19 pandemic control and economic recovery. Faced with the unexpected outbreak of the pandemic, China adhered to its people-centered philosophy, putting people's health and safety above everything else, and effectively contained the spread of the virus, preventing millions of people from contracting potential infections.

China has stepped up its macro policy responses, scientifically and comprehensively promoted the prevention and control of the pandemic as well as economic and social development. We introduced a number of fiscal, financial and social security bailout and assistance policies, made every effort to stabilize employment and protect people's livelihoods, and helped enterprises in difficulty to maintain their market share. A special transfer payment mechanism was put in place to ensure that the new fiscal deficits and government bonds for COVID-19 control totaling RMB 1.7 trillion yuan go straight to prefecture and county governments and directly benefit businesses and people. Reforms to streamline administration and delegate power, improve regulation, and upgrade services were steadily advanced. All these measures have effectively promoted the restoration of order in production and life, the continuous and steady economic recovery, and basically stable employment situation.

The impact of the pandemic has led to a sharp contraction in global cross-border investment and trade in goods, as well as serious disruptions in the movement of people and goods. The world economy experienced its worst recession since the Great Depression in the 1930's, and global trade is expected to shrink by 13% to 32%. The impact of COVID-19 pandemic on the world goes beyond the international financial crisis in 2008.

The turnaround of China's economic growth from negative to positive is good news for the world economy that has been deeply affected by the COVID-19, will undoubtedly inject positive energy and boost the global economy recovery, including South Africa and other African countries. As IMF Managing Director Kristalina Georgieva said, China's growth amid the COVID-19 pandemic is a positive impulse for the world. According to Fitch International, an international rating agency, "it is important not to underestimate the positive global spillovers that will flow from China's recovery". The international community is generally positive about China's integration of pandemic prevention and control with economic and social development, and expects that the rest of the world will benefit from China's economic growth, revitalized markets and increased domestic demand.

The fifth plenary session of the 19th Central Committee of the Communist Party of China (CPC) held in late October, laid out a new blueprint for China's future development, confirming that China will foster a new development pattern where domestic and foreign markets can boost each other, with the domestic market as the mainstay. This economic development paradigm will place greater emphasis on expanding domestic demand and opening up the domestic market, as well as on international cooperation and opening up to the outside world.

Building a new development pattern is an important way of thinking for China in the light of its stage of development and changes in the external environment. It is a strategic choice to reshape China's international cooperation and new competitive edge in the face of economic globalization under the impact of unilateralism, protectionism and trade bullying.

As the economy size continues to expand and the economic structure continues to adjust, China's economic growth will gradually become more dependent on domestic demand and the proportion of exports will continue to decline. Internationally, the larger the economy, the higher the income level and the higher the share of services in the GDP of a country, the more a portion of the GDP will be absorbed within the country. As China's economy transforms and upgrades, the share of high-end manufacturing and services will increase, and sustainable development will become more dependent on domestic economy.

The new development pattern emphasizes the importance of expanding domestic demand. It is not just a simple repetition of the past, but rather an insistence on transforming the mode of development, adjusting the economic structure, promoting scientific and technological innovation, fostering new kinetic energy for economic growth, and forming more new growth poles. So that we could improve the quality and efficiency of development, and meet the people's growing demand for a better life.

Since the international financial crisis in 2008, China's economy has been shifting towards expanding domestic demand. To accelerate building a new development pattern will surely help giving full play to the advantages of China's mega-market, adding a new and powerful impetus to world economic growth through domestic economic prosperity. With a 1.4 billion population and a middle-income group of over 400 million, China has become the world's most promising market. This huge market size will certainly drive exports and investment to China from all countries in the world, including African countries, increase world demand through international trade, and facilitate the recovery of the global economy from COVID-19 pandemic contraction.

The new development pattern is not about "self-isolation", but about promoting a higher level of openness. The Chinese government is pursuing an open, new, dual-cycle development architecture with the domestic cycle as the mainstay and with domestic and international development reinforcing each other, rather than a closed domestic loop. Focusing on the domestic cycle does not in any way mean that the country is now closed or disconnected from the world economy, nor does it mean a change in the basic national policy of reform and opening up.

The sustainable development of China's economy, with the strategic base of expanding domestic demand and making production, distribution, circulation and consumption more dependent on the domestic market, does not mean that international circulation is irrelevant, rather that China should embrace free trade more deeply and further integrate with the world economic system in all aspects, including investment, trade, production and circulation.

On 15 November, China signed the Regional Comprehensive Economic Partnership with 14 Asia-Pacific countries, formulating the world's largest free trade area. On 20 November, President Xi Jinping said in his speech at the 27th APEC Economic Leaders' Meeting that "China welcomes the signing of the Regional Comprehensive Economic Partnership (RCEP), and will favorably consider joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)".

Premier Li Keqiang said at the East Asia Summit on November 14th that China will pursue a higher level of opening-up across the board, promote trade and investment liberalization and facilitation, and improve the management system combining pre-establishment national treatment and the negative list system for the access of foreign investment. The lawful rights and interests of foreign businesses will be protected in China in accordance with the law and foster a level playing field where all businesses, domestic or foreign, are treated as equals. China, as a big market open to the whole world, will provide more development opportunities for its neighbors as well as the world.

In recent years, China's contribution to world economic growth has remained at around 30%. In the new development pattern, there is every reason to expect that a more open China will make an even greater contribution to the world economy.

Suggest To A Friend:   
Print