The Locomotive of World Economic Development: China

Liao Liqiang
Wednesday 11 May 2022

China is now developing new engines of economic growth, new modes of social life and new pathways of people-to-people exchange, in order to facilitate cross-border trade, keep industrial and supply chains secure and smooth, and to promote steady and solid progress in global economic recovery.

Since the beginning of this year, China’s economy has continued to recover and its overall economic performance has been stable, providing strong momentum for the stabilization and recovery of the world economy. China's economic performance mainly has the following five highlights:

 

First, the main macro indicators remained within a reasonable range. From the perspective of growth, the economy continues to maintain a momentum of expansion. In the first quarter, the GDP increased 4.8% year on year, 0.8 percentage point higher than that in the fourth quarter of the previous year, and the month-on-month growth rate was 1.3%.

In terms of employment, despite the impact of COVID-19, the overall stable employment situation has not changed. 2.85 million new urban jobs were created and the national urban surveyed unemployment rate stood at 5.5% in Q1, basically the same as Q1 of last year.

In terms of commodity prices, the supply of goods and services in the market was generally sufficient, and consumer prices rose moderately. In the first quarter, consumer prices rose by 1.1% year on year.

In terms of the balance of payments, the trade surplus in goods expanded, the trade deficit in services narrowed, foreign exchange reserves remained stable at around $3.2 trillion, and the balance of payments remained stable.

Second, growth in industrial production picked up, and the industrial structure has been optimized. In the first quarter, the added value of industrial enterprises above the designated size increased by 6.5% year on year, 2.6% higher than the previous quarter. The added value of the manufacturing industry increased by 6.1% year on year, accounting for 28.9% of the GDP, an increase of 1.3% over the same period of the previous year.

The equipment manufacturing industry and high-tech manufacturing saw year-on-year growth of 8.1% and 14.2% respectively. New business forms and models continued to develop. The online retail sales of physical goods increased by 8.8% year on year, maintaining growth from an already high scale and accounting for 23.2% of the total retail sales of consumer goods.

Third, green transformation kept steadily advancing. Green and low-carbon products grew rapidly. In the first quarter, the output of new energy vehicles and solar cells increased by 140.8% and 24.3% respectively. The proportion of clean energy consumption continued to rise. In the first quarter, the proportion of clean energy consumption, such as electricity generated by natural gas, water, nuclear, wind, and photovoltaics, increased by 0.8 percentage point over the same period of the previous year. Energy consumption per unit of GDP continued to decline. In the first quarter, energy consumption per 10,000 yuan of GDP dropped by 2.3% year on year.

Fourth, opening-up continues to deliver development dividends. China's policies of stabilizing foreign trade have continued to work. In spite of complicated and challenging international circumstances, the world economy is still recovering on the whole, and demand for China's exports will continue to grow. The Belt and Road Initiative has continued to deliver benefits. In the first quarter, China's imports and exports expanded by 7.5% and 13.4% respectively from a high base last year. Foreign investment in actual use increased by 25.6% year-on-year.

Fifth, people's livelihood was improved and domestic demand potential was further released. Residents' income continued to grow in the first quarter. The country's per capita disposable income increased by 5.1% year on year in real terms and the basic living consumption of residents was guaranteed. The added value of the consumer goods manufacturing industry increased by 8.1% year on year, maintaining relatively rapid growth. Investment in the people's livelihood sector continued to grow, with investment in education and health increasing by 17.2% and 23.8% respectively.

The world economy is emerging from the depths, yet it still faces many constraints. The global industrial and supply chains have been disrupted. Commodity prices continue to rise. The energy supply remains tight. These risks compound one another and heighten the uncertainty about economic recovery. The global low inflation environment has notably changed, and the risks of inflation driven by multiple factors are surfacing. The fundamentals of China’s economy - its strong resilience, enormous potential, adequate policy leverage and long-term sustainability - remain unchanged. These will provide great dynamism for the stability and recovery of the world economy and broader market opportunities for all countries.

China is now developing new engines of economic growth, new modes of social life and new pathways of people-to-people exchange, in order to facilitate cross-border trade, keep industrial and supply chains secure and smooth, and to promote steady and solid progress in global economic recovery.

As the world stands at a crossroads of history, we must be keenly aware that economic globalization is the irreversible trend of our times and openness and connectivity is an irresistible historical trends. The trend of openness and cooperation among countries has not changed and will not change. China is ready to work with Egypt to tackle global threats and challenges, promote the establishment of a community with a shared future for mankind, and jointly build a better world.

*The writer is Chinese Ambassador to Egypt

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