/ world today news/ Economists and experts, both in the East and in the West, discussed whether China will be able to achieve its target of economic growth of GDP of 5 percent for 2023. Moreover, according to some experts, the country may show even higher growth. The latter turned out to be right, because in the first half of the year, the PRC actually achieved 5.5% GDP growth – an impressive and serious achievement, especially in view of global instability, the recent Covid pandemic and geopolitical opposition in the world.
And the fact that the PRC managed to reach 5.5% growth is good, because in recent decades China has actually become one of the main factors for world economic growth, and in today’s situation also for global economic recovery. But even more important than that, it’s about high-quality development, not just mechanical growth.
The topic of China’s economic outlook this year is particularly relevant after the country opened up after actually dealing with the Covid pandemic, which hit the whole world particularly hard. Of course, recovering from a severe global pandemic that has shut down the entire world is not easy. Five percent growth is lower than China’s growth in the past 30 years. But it is many times better than any western country, for example.
The key here is that China has shown that it is particularly adaptable and its economy can work both under conditions of strict anti-pandemic measures and when opening up.
This is a definite proof that the Chinese economy is oriented towards qualitative development, not just large quantitative indicators. But, of course, some detractors of the country continue to gloat that China is just someone’s workshop for low-value-added products. And what is the truth?
Here are some facts. From January to May this year, the added value of the equipment manufacturing industry increased by as much as 6.8% over the previous year, which in turn is more as a percentage of China’s overall industrial growth.
Investments in the highly developed scientific and technological sectors of the economy increased by as much as 12.8 percent in the first half of this year. In turn, the production of new electric vehicles has increased by 37 percent, which in itself has become a factor in increasing China’s economic development.
The role of innovation is strengthened and new industries and new forms of business are constantly emerging, which leads to the overall high-quality development of the Chinese economy and paves its way to a developed society (although it is important to note that China is still developing country).
A spokesman for China’s National Bureau of Statistics said that in the first quarter of the year, China’s economy grew by 4.5 percent, which proved to be a very good base not only to reach the stated target of 5 percent GDP growth for this 2023 year, but also surpassing it by half a percentage point.
In the second quarter, growth was actually faster and economic indicators are beginning to return more to their pre-pandemic normal. The same cannot be said for the economies of those countries that most often criticize China or gloat about the quality of its economy.
If we return again to the sphere of numbers and statistics, the foreign trade, which is so important and key for the PRC, is very telling. Despite all the post-pandemic challenges, including more limited foreign demand and geopolitical turmoil caused by some countries’ Cold War-style policies, China’s combined imports and exports rose 4.7 percent to 16.77 trillion Chinese yuan, which is about 2.32 trillion US dollars – a colossal and historic figure. And that’s just for the first five months of 2023.
These impressive statistics lead to most international institutions, organizations and research centers raising their expectations for the development and quality of the Chinese economy, including GDP growth rates in 2023 and also in 2024. The international community shows that it has great confidence in China, and the countries of the Global South (Africa, Latin America and a large part of Asia) do not hide that they actually see China as a major engine of post-pandemic recovery and global economic growth.
The most striking is the case of the World Bank and its latest Global Economic Outlook – the WB raised its expectations for China’s GDP growth from 1.3 to as much as 5.6 percent this year, and came close to the figures that ended up being reached.
According to the UN’s “World Economic Situation and Prospects for 2023”, China will see 5.3 percent growth in its economy, which is an increase from the assumed 4.8 percent in January, but about 0.2 percent less as forecast from the actual 5.5% that the country reached. The International Monetary Fund also reckoned the country would grow its GDP by 5.2 percent this year, and now the fund’s economists are likely to be even more impressed.
And this, as has been said, is not merely a mechanical increase because of a large population, as China has, say. All international institutions point out that it is also due to high labor productivity, efficient logistics, adequate tax and customs policy, as well as specific government policies to promote growth and stimulate the modern and high-tech sectors of the economy.
This year, China introduced a number of policies to promote foreign investment, improve the business climate, and promote technology sectors, all of which were noted by foreign investors and international organizations. Only in the first five months of 2023, 18,532 new business ventures with foreign investments were created in the country, which is a 38.3 percent increase. It is obvious that for international business, China remains one of the most desirable destinations and a country with a stable business climate that can offer a highly skilled and educated workforce, a modern and developed infrastructure and a number of incentives for investors.
But the key is not just the economic statistics, which are current at the moment, but also the overall philosophy of Chinese development, which is oriented specifically towards high-quality and sustainable development. And it can only be the product of policies that are based on China’s assets, cultural, civilizational and political characteristics, as well as the promotion of science, education and human development.
The key point is that for high-quality development, China relies on its tradition, and not on ready-made recipes from the West. Instead of financial sector reform, shock therapy and privatization, China has already begun with reforms in agriculture, education and the scientific sector. And of course, extensive and serious state support for the development of a truly modern infrastructure, both transport and energy, port, airport and more.
China’s modernization was and still is tailored to the conditions of the global economy, but in a way that makes it possible for the country to integrate at its own pace and speed, on its own terms, into global chains of logistics, trade and interconnection.
At the 20th National Congress of the Communist Party of China, it was promised that the country would continue to carry out reforms for the development of the socialist market economy and an opening of the country with high standards, driving precisely high-quality development.
And as economic indicators and markets show, China is on track with all of this. The answer to this success lies in the ongoing reforms and opening up – not just post-Covid, but of the Chinese economy in general for years. With unceasing efforts, China is modernizing its economic system and infrastructure, building the world’s most serious industrial chain, as well as a suitable network for supporting production and logistics.
And something important – China has become a leader in innovative technologies, including green technologies and renewable energy, artificial intelligence, Big Data, simplified and optimized administration, biotechnology, nanotechnology and what not.
Thus, China is focused on building not just a large but a high-quality economy that will lead to the achievement of its mid-century goal of “building a modern socialist state that is prosperous, strong and culturally advanced and harmonious “. The deadline set by the Chinese Communist Party is 2049, which is the centenary of the founding of the People’s Republic of China in 1949. And so far, all indications are that China will be up to the task. And besides, it is changing the whole world, saving the global economy and creating an impetus for the development of countries throughout the Global South and beyond.
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