Chinese economy fares steadily ahead amid uncertainties

China Plus Published: 2019-06-10 22:41:10
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Note: The following article is taken from the Chinese-language "Commentaries on International Affairs".

China's General Administration of Customs announced on Monday that the country's foreign trade in goods rose 4.1 percent year on year in the first five months of this year to 12 trillion yuan (about 1.76 trillion U.S. dollars). On the same day, the Ministry of Culture and Tourism announced that China saw nearly 96 million domestic tourist trips made during the three-day Dragon Boat Festival holiday, which ended on Sunday, up 7.7 percent from the same period last year. And tourism revenues have surpassed 39 billion yuan (about 5.7 billion U.S. dollars), up 8.6 percent year-on-year.

Stacks of containers wait to be shipped abroad at the port of Lianyungang, east China's Jiangsu province, June 10, 2019. [Photo: IC]

Stacks of containers wait to be shipped abroad at the port of Lianyungang, east China's Jiangsu province, June 10, 2019. [Photo: IC]

The figures come amid escalating global trade frictions and slowing international trade, indicating the strong resilience, great potential and momentum in the Chinese economy.

China's foreign trade in the first five months features two remarkable characteristics:

The growth rate of general trade, which contains higher brand value and technological content, reached 6.1 percent. Its share in the country's total foreign trade increased by 1.1 percentage points in the first five months year-on-year. This indicates that China's ongoing industrial upgrading has made its products more competitive in the international market.

Though the total value of Sino-US trade in the first five months fell 9.6 percent, China's trade with other major partners, including the European Union, ASEAN and Japan, continues to grow. The growth in trade volumes among China and Belt and Road countries has come in 4.9 percentage points higher than the overall growth rate of the country's foreign trade. This means that China's foreign trade partners are increasingly diversified, which helps enhance China's ability of dealing with the downward pressure in foreign trade.

The better-than-expected figures didn't come easy. In fact, China couldn't have been what it is now without overcoming varied economic difficulties. The country's economy has become increasingly resilient after marching through the 1997 Asian financial crisis and the 2008 global financial meltdown. As the world's second largest economy with the world's largest industrial output, the largest goods trading nation, and the largest foreign exchange reserve holder, China's total economic output has exceeded 90 trillion yuan (13.03 trillion U.S. dollars). The country has the world's largest consumer market with about 1.4 billion people, as well as the world's most complete industrial supply chain. Taken all together, authorities in China should have every confidence that they are able to cope with any economic uncertainty.

Moreover, high-quality development has become another remarkable feature of the Chinese economy. Domestic demand has become the major force driving economic development, contributing more than 100 percent to the country's growth. The dependence of China's economy on foreign trade has fallen to around 33 percent with its economic structure continuously being optimized. In 2018, China's total research spending increased to account for 2.18 percent of the total GDP, with research and development contributing over 58 percent of GDP growth. China, for the first time, cracked into the world's top 20 most-innovative economies last year. The economic transformation driven by innovation has built up the country's capability in managing external risks.

An increasing open Chinese economy has also offered a haven for international capital. In the first four months of this year, China’s actual use of foreign investment increased by 6.4 percent year-on-year. Multinational companies such as Qualcomm, OSI Group, Jaguar Land Rover and Schneider Electric have said that they will continue to explore the Chinese market and participate in the high-quality development of China's economy.

In fact, the steadily growing Chinese economy has been playing a stabilizing role in world economic development. The country’s contribution to global growth has been standing above 30 percent for years. Former French Prime Minister Jean-Pierre Raffarin has said the predictability of China's development trend is a valuable quality in today's world. According to the long-term forecast of the OECD, China will remain the largest contributor to global growth.

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LU Xiankun Professor LU Xiankun is Managing Director of LEDECO Geneva and Associate Partner of IDEAS Centre Geneva. He is Emeritus Professor of China Institute for WTO Studies of the University of International Business and Economics (UIBE) and Wuhan University (WHU) of China and visiting professor or senior research fellow of some other universities and think tanks in China and Europe. He also sits in management of some international business associations and companies, including as Senior Vice President of Shenzhen UEB Technology LTD., a leading e-commerce company of China. Previously, Mr. LU was senior official of Chinese Ministry of Commerce and senior diplomat posted in Europe, including in Geneva as Counsellor and Head of Division of the Permanent Mission of China to the WTO and in Brussels as Commercial Secretary of the Permanent Mission of China to the EU. Benjamin Cavender Benjamin Cavender is a Shanghai based consultant with more than 11 years of experience helping companies understand consumer behavior and develop go to market strategies for China. He is a frequent speaker on economic and consumer trends in China and is often featured on CNBC, Bloomberg, and Channel News Asia. Sara Hsu Sara Hsu is an associate professor from the State University of New York at New Paltz. She is a regular commentator on Chinese economy. Xu Qinduo Xu Qinduo is CRI's former chief correspondent to Washington DC, the United States. He works as the producer, host and commentator for TODAY, a flagship talk show on current affairs. Mr. Xu contributes regularly to English-language newspapers including Shenzhen Daily and Global Times as well as Chinese-language radio and TV services. Lin Shaowen A radio person, Mr. Lin Shaowen is strongly interested in international relations and Chinese politics. As China is quite often misunderstood in the rest of the world, he feels the need to better present the true picture of the country, the policies and meanings. So he talks a lot and is often seen debating. Then friends find a critical Lin Shaowen criticizing and criticized. George N. Tzogopoulos Dr George N. Tzogopoulos is an expert in media and politics/international relations as well as Chinese affairs. He is Senior Research Fellow at the Centre International de Européenne (CIFE) and Visiting Lecturer at the European Institute affiliated with it and is teaching international relations at the Department of Law of the Democritus University of Thrace. George is the author of two books: US Foreign Policy in the European Media: Framing the Rise and Fall of Neoconservatism (IB TAURIS) and The Greek Crisis in the Media: Stereotyping in the International Press (Ashgate) as well as the founder of, an institutional partner of CRI Greek. David Morris David Morris is the Pacific Islands Trade and Investment Commissioner in China, a former Australian diplomat and senior political adviser. Harvey Dzodin After a distinguished career in the US government and American media Dr. Harvey Dzodin is now a Beijing-based freelance columnist for several media outlets. While living in Beijing, he has published over 200 columns with an emphasis on arts, culture and the Belt & Road initiative. He is also a sought-after speaker and advisor in China and abroad. He currently serves as Nonresident Research Fellow of the think tank Center for China and Globalization and Senior Advisor of Tsinghua University National Image Research Center specializing in city branding. Dr. Dzodin was a political appointee of President Jimmy Carter and served as lawyer to a presidential commission. Upon the nomination of the White House and the US State Department he served at the United Nations Office in Vienna, Austria. He was Director and Vice President of the ABC Television in New York for more than two decades.