As the world economy struggles with a lingering pandemic and increasing headwinds, China is expected to continue to act as a stabilizer for the global economy with its sound long-term fundamentals.
At the Annual Meeting 2022 of the World Economic Forum (WEF), which concluded Thursday, participants have warned that the world economic outlook has “darkened” amid increasing uncertainties.
“We are seeing additional weaknesses in the global economy,” Gita Gopinath, the first deputy managing director of the International Monetary Fund (IMF), told Xinhua in an interview at the WEF in Davos, Switzerland.
When talking about her outlook on the Chinese economy, Gopinath said, if China can deal with the “near-term headwinds in terms of COVID” and others, then, “of course, it will remain as one of the important engines of growth.”
RECOVERY ON TRACK
China’s economy took a hit from the resurgence of COVID-19 cases in April, but is expected to recover gradually as the country achieves major anti-epidemic outcomes and pro-growth policies take effect.
Official data showed that in spite of some indicators contracting in April, the country’s economy is on track to recover. Meanwhile, indicators measuring factory activities and investment posted year-on-year growth.
Manufacturing investment jumped 12.2 percent year on year during the first four months, while infrastructure investment maintained growth of 6.5 percent year on year.
“This shows that investment will provide important support to the economic growth,” said Fu Linghui, spokesperson for the National Bureau of Statistics, adding that there are many favorable conditions for stabilizing the economy and achieving the expected development goals.
“The fundamentals of the Chinese economy remain unchanged. The overall trends of economic transformation and upgrading and high-quality development remain unchanged,” Fu said.
In particular, China’s inflation has remained at an overall moderate level against the backdrop of soaring global inflation.
In April, the IMF projected in its World Economic Outlook that global inflation will reach 5.7 percent in 2022 in advanced economies and 8.7 percent in emerging markets and developing economies, 1.8 and 2.8 percentage points higher than the January projection.
Also in the report, the organization slashed global growth forecasts to 3.6 percent in 2022 and 2023. This is 0.8 and 0.2 percentage points lower for 2022 and 2023 than it had projected in January.
“In long and medium term I’m quite bullish on China’s economy,” WEF President Borge Brende told Xinhua in an interview, noting that China’s stable economic growth is of great significance to global recovery.
BOLSTERING INTERNATIONAL COOPERATION
From the global economy’s perspective, China’s growth has implications for global trade and for growth in other parts of the world.
On multiple occasions from the Boao Forum for Asia Annual Conference in April to the conference marking 70th anniversary of China’s trade promotion body and the Global Trade and Investment Promotion Summit in May, China’s top leadership has reiterated the country’s resolve to not only carry forward with its own opening-up but push for an open world economy.
So far, the country has become the largest trading partner of more than 120 countries and regions.
As the lingering COVID-19 pandemic, geo-political conflicts and other rising uncertainties cast a shadow over the global trade, China’s foreign trade sustained resilience and growth momentum, contributing to stabilizing the global supply chain.
In the first four months, the country’s total foreign trade expanded 7.9 percent year on year, with exports and imports rising 10.3 percent and 5 percent, respectively, data from the General Administration of Customs showed.
To further keep industrial and supply chains stable, the State Council, China’s cabinet, detailed more measures to stabilize and upgrade foreign trade on Thursday.
Services for key foreign trade enterprises will be enhanced and measures will be put into place to ensure unimpeded logistics for foreign trade cargos, a guideline released by the State Council said.
With steady economic recovery, China’s imports from other markets are likely to grow faster thanks to the country’s supportive measures on foreign trade, which is expected to further boost global economic recovery and the stabilization of global supply chain, analysts said.