China’s economy expected to receive major boost from 20th Party Congress, to anchor global economy for long term

BEIJING, September 9, 2022 /PRNewswire/ — As the global economy is mired in a confluence of crises ranging from energy shortages to skyrocketing inflation to recessionary pressure in major economies, global attention is focused on the Chinese economy, the main engine of global growth, before the upcoming 20th National Congress of the Communist Party of China (CPC) scheduled for mid-October, which is expected to light the way for the world’s second-largest economy for years, if not decades, to come.

China’s economy is currently facing multiple downward pressures, including COVID-19 outbreaks and weakening external demand, as evidenced by a significant slowdown in exports in August.ust. However, China economic fundamentals remain strong, in stark contrast to dire situations in other major economies, and there are enough bright spots and policy measures that will ensure stable growth in such a crucial year, economists said.

Longer term, China will continue to be the main engine of growth in the world economy, as the 20th CPC National Congress will instill confidence and lead the nation to embark on the pursuit of the second centenary goal of building China into a modern socialist power, with all its institutional advantages that have ensured success over the past decades, the economists pointed out.

Resilience in the Middle pressure

The moderation in trade growth could be attributed to the reduction in online ordering with a general decline in external economies, Huo Jianguovice president of the China Institute for World Trade Organization Studies, told the Global Times on Thursday.

A competitive devaluation in Japan, South Koreaamong other countries amid a strong US dollar, also exerted downward pressure on China exports, Huo said.

The Chinese yuan has weakened more than 9% against the US dollar so far this year, but it remains much stronger than the Japanese yen and South Korean won, he continued, adding that sporadic national outbreaks of Omicron had some impact on export-facilitated logistics capabilities.

The country’s dollar exports rose 7.1% in August from a year earlier, while its exports edged up 0.3% in August year-on-year, according to customs data released on Wednesday. That compares with an 18.0% gain in export growth and a 2.3% rise in imports in July.

A loss of confidence in the country’s export prowess should by no means be justified, Huo said, citing trade readings that point to the sustained competitive advantages of notably private companies, the mainstay of China export juggernaut.

China Dollar-denominated mobile phone exports rose 3.9% in the first eight months, following a 2.1% increase in the first seven months, according to customs statistics.

The rebound resisted a general slowdown in the country’s exports of mechanical and electrical products from July to August, which accounted for more than half of total exports.

In particular, the country’s dynamic exports of new energy products set it apart from other major economies..

In a new sign, Tesla’s Gigafactory Shanghai delivered 399,939 vehicles in the first eight months, just some 80,000 vehicles less than its full-year 2021 delivery, the US electric carmaker said in a statement. sent to the Global Times on Thursday.

In the first half, China exports of new energy vehicles jumped 1.3 times to 202,000 units, accounting for 16.6 percent of total vehicle exports, according to figures from China Automobile Manufacturing Associationrs.

Taken into account China the technological and manufacturing forces in the new energy industrial chains and the push from the EU for its new energy policy framework known as REPowerEU which aims to make the EU’s energy supply more secure, energy product exports will likely be a bright spot in the export landscape, Chang said in a research report sent to the Global Times.

The structural strength of the trade pillar which reflects the rebalancing of the economy as a whole puts the economy in a de facto advantageous position amid growing worries about global growth, experts pointed out, expecting the economy maintains power in the coming months.

With the export juggernaut still in work mode, albeit possible at a slower pace in the face of the overall global gloom, and still strong infrastructure project commitments, the Chinese economy as a whole should fare better. out than other major economies, although a full rebound in the country’s consumer market will still take time, Huo said.

source of optimism

In a new attempt to revitalize the economy, a State Council executive meeting chaired by Premier Li Keqiang pledged on Wednesday to end the broadcast of 500 billion yuan ($71.92 billion) special bonds from previously unused local government quotas since 2019 by the end of October, the state broadcaster reported Thursday.

Issuing bonds would prioritize funding for projects under construction, according to the report. Wednesday’s meeting also called for stronger policy support for jobs and entrepreneurship to nurture new momentum for growth.

The new reading of the meeting, in addition to Monday’s announcement of a new 300 billion yuan in funds through a political bank financing agreement targeted at infrastructure, is supposed to reassure the markets on the ability of the Chinese economy to overcome transitional challenges.

“We expect that the measures taken by China and Chinese authorities will lead to renewed growth,” Xinhua said in an article published earlier this year, quoting the chairman of the World Economic Forum (WEF). Borge-Brende.

Expressing his optimism about China medium and long-term economic development, Brende said that “China role in securing global growth has been incredible… What’s going on in China has a huge economic impact on the rest of the world, and it will continue because it’s the second largest economy.”

A bright future

With all eyes on the upcoming 20th CPC National Congress to be held in mid-October, a monumental gathering that will spearhead economic and societal trends, the economy is set to get a big boost, thereby anchoring the global economy to more secure growth. , Cao Hepingeconomist at Peking University, told the Global Times on Thursday.

The country has achieved the first centenary goal – to build a moderately prosperous society in all respects, Chinese leaders announced on the occasion of the 100th anniversary of the founding of the CPC on July 1, 2021.

The upcoming congress must be an important event to cement confidence in the country’s unwavering call for higher-level openness and its continued reform efforts in the area of ​​business climate, fair competition, among others, stressed Huo, expecting even bolder moves in flexing the country’s institutional strengths to paint China as a tireless engine of global growth.

Banking on the fact that the congress will be a cohesive, enlightening and triumphant gathering, Cao was confident that the meeting would set the tone to inspire confidence in the global business community, which depends on the growth of a more open and stronger Chinese economy. which will continue to chart the course of globalization regardless of various uncertainties.

SOURCE World Time