Opinion| The biggest certainty in an uncertain world: Chinese economy ushers in promising era

Liao Liqiang
8 Min Read

The outbreak and continued surge of the novel coronavirus (COVID-19) has thrown the global economy into uncertainty. 

Faced with the impact of the pandemic during winter and spring, as well as uncertainties in the external environment, 1.4 billion Chinese people have all worked under the strong leadership of the CPC Central Committee, with President Xi Jinping at its core.

It has consolidated and expanded the progress on epidemic prevention and socio-economic development. China’s national economy delivered a stable performance with a consolidated foundation and a good momentum of growth. Gross domestic product (GDP) in the first quarter (Q1) of 2021 increased by 18.3% year-on-year (y-o-y) at comparable prices, marking the highest quarterly growth since the statistics began. 

The highlights in the main indicators of the Chinese economy are many.First, employment remains stable on the whole. China’s surveyed urban unemployment rate averaged 5.4% in Q1 of 2021, 0.4 percentage points lower than the same period last year, whilst 2.97 million new jobs were created. 

Second, industrial production rebounds steadily. The total value added of industrial enterprises above the designated size increased 24.5% on a yearly basis in Q1 of 2021. 

Industrial electricity consumption and railway freight volume increased by 23.9% and 13.9%, respectively. The utilisation rate of industrial capacity reached the highest for the same period since 2013.

Third, new growth drivers are gaining momentum. The added value of high-tech manufacturing grew by 31.2%, and new-energy vehicles (NEVs) output increased by 3.1 times. 

Fourthly, market vitality has been effectively stimulated, with 2.792 million tax-related market entities newly registered in Q1 of 2021 nationwide, seeing a y-o-y growth of 86%.

Fifth, foreign trade and foreign investment increased significantly. Imports and exports of goods grew noticeably and the trade structure continued to improve. 

The total value of exports was Yuan 4.6140trn, up by 38.7% y-o-y, and that of imports was Yuan 3.8547trn, up by 19.3% y-o-y. 

Foreign direct investments (FDI) into the Chinese mainland surged 39.9% y-o-y in actual use, to Yuan 302.47bn in Q1 of 2021.

Sixth, investment and consumption recovered steadily. The investment in fixed assets (excluding rural households) reached Yuan 9.5994trn, up by 25.6% over last year. The total retail sales of consumer goods reached Yuan 10,522.1bn, up by 33.9% y-o-y.

Seventh, market confidence and expectations have improved markedly. The purchasing managers’ index (PMI) for China’s came in at 51.9% in March, edging up from 50.6% in February. The non-manufacturing purchasing managers’ index stood at 56.3%, which was 4.9% higher than that in February.

And lastly, people’s living standards have been steadily improved. In Q1 of 2021, the per capita disposable income of residents nationwide was Yuan 9,730, reflecting a 13.7% increase year-on-year. Additionally to this, air quality has been rated as good 80.9% of the time.

China has shown itself to have a sustained, stable development engine.Since the beginning of this year, China has made major efforts in the following areas to effectively address major short-term difficulties, and provide sustained and stable impetus for economic development. 

First, China strengthened its “job first” policy. We support the healthy development of new forms of employment, protect the legitimate rights and interests of people who have flexible employment, and continue to provide better employment services to key groups such as college graduates, veterans, and rural migrant workers. 

Second, China is further lifting the burden on market participants. The country has encouraged people to start businesses and make innovations, whilst taking concrete measures to reduce taxes and fees for small- and medium-sized enterprises (SMEs), and ensuring that tax cuts are fully implemented. 

Thirdly, China is optimising the overall business environment to promote fair competition. The government is persisting in reform efforts to streamline administration, delegate power, and improve services. 

Document materials, procedures, and costs involved in enterprise approvals have largely been reduced. China is strengthening and making innovations in regulating the Interim and Post-Event Supervision. 

New measures are introduced including action plans of building a high-standard market system, and issuing anti-monopoly guidelines on the platform companies.

Fourthly, China has been advancing a high-level opening up, and has implemented policies to support foreign trade and investment. 

The country is making solid progress in building a pilot free trade zone, sped up the building of Hainan Free Trade Port, and achieved phased results. We have made good preparations for the implementation of the Regional Comprehensive Economic Partnership (RCEP), and made remarkable progress in advancing the Belt and Road Initiative, as well as international economic and trade cooperation. 

In addition, solid progress has been achieved in urbanisation, regional development strategies, and capacity building for scientific and technological innovation. China is now promoting high-quality development of the manufacturing industry, and made new strides in rural revitalization and agricultural and rural modernization.

China’s rapid economic growth has injected impetus and confidence into the world economy. Despite the world economy now being full of uncertainties, China’s future is certain. 

Its robust economic growth in Q1 of 2021 reflects the extraordinary resilience and sustained momentum of the Chinese economy. The measures proposed by the Chinese government to achieve the Belt and Road Initiative include high-quality cooperation.

It aims to promote trade and investment liberalisation and facilitation, which will further deepen mutually beneficial cooperation with countries around the world, including Egypt, and inject strong impetus into global economic recovery.

Although the world economy is still in a dark cloud of uncertainty caused by the pandemic, I believe people around the world will find a silver lining and gain confidence from China’s economic recovery. 

On the one hand, China’s economic recovery shows that as long as all countries focus on their own business, strengthen international cooperation, and draw on each other’s strengths, the pandemic can be brought under control and the economy can recover soon. 

On the other hand, as an important engine driving global trade and economic recovery, China is the world’s largest consumer market. The resumption of the country’s economic growth has provided broad space for the development of global businesses.

It has also promoted the stability of the international industrial chain, thus bringing real opportunities and benefits to all nations.

Liao Liqiang, China’s Ambassador to Egypt

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