Lately, the international community has fixed its attention further on China’s economy, with some voices of questioning and concern in between. But judging by China’s economic data from the first six months of 2024, there’s still considerable resilience in China’s economic development, and the Chinese economy will maintain a positive trajectory over the long run.
Where is the statement grounded?
Judging from the numbers, China’s GDP saw a year-on-year increase of 5.0% in the first half of 2024. Given the relatively weak momentum in the global economy, the frequent frictions in international trade, and insufficient domestic demand in China, the overall stable performance of China’s economy bears testament to the resilience of the Chinese economy. Seeing into it, such resilience stems from rather complete industry categories and the advantageous industry chain driven by innovation, and such resilience also exists in the dividends released by China through deepening reforms. Shekou Container Terminal in Shenzhen
Here's an example. “It takes a thousand workers to do the spinning and ten thousand to do the weaving.” This old saying best conceptualizes how labor-intensive China’s textile industry was. But now, in Dasheng Group’s smart spinning factory in Jiangsu Province, numerous machines operate at full speed in tidy and spacious workshops, and only a few workers can be seen patrolling for inspection. Adopting technologies including 5G data transmission, the factory has enjoyed digital and smart production and storage, giving it an over 20% increase in production efficiency and bringing down the defect rate by over 15%.Dasheng Group’s smart spinning factory [source: Xinhua]
More smart spinning factories like this are mushrooming. Since late last year, Chinese authorities have carried out measures to upgrade production equipment, which also acted as an impetus to drive the manufacturing business in China towards becoming more high-end, environmentally friendly and intelligent. When these efforts are translated into economic performance, China’s manufacturing sector has played a more competent role in driving investment. In the first half of 2024, the total value added of industrial enterprises above the designated size grew by 6.0% year-on-year; industrial production has seen quicker spurts of vitality, with the total value added of high-tech industries increasing by 8.7%. These have powerfully endorsed the pleasing performance of China’s economy.A smart manufacturing enterprise in Yangzhou City, east China's Jiangsu Province
The smart factory example is just one demonstration of China’s practice in advancing high-quality economic development through reforms and innovation. In the past decade or so, China has used economic structural reform as the spearhead, to comprehensively deepen reforms, thereby injecting greater vitality into the economic development, while reinforcing the resilience of the Chinese economy.
At the third plenary session of the 20th Central Committee of the Communist Party of China, the resolution on further deepening reform comprehensively to advance Chinese modernization was adopted. Once again, using economic structural reform as the spearhead has been highlighted, and the roadmap of reforms has been further clarified. Building a unified national market, formulating a private sector promotion law, improving the institutions and mechanisms for fostering new quality productive forces in line with local conditions… the array of measures listed in the document all guide the future pathway of China’s economy.[source: VCG]
Currently, there are still many problems facing China’s economy. However, China is committed to further deepening reform comprehensively, and made practical solutions to that end. With that, plus the complete industry system and China’s advantage as a giant market, we have every reason to believe that, China’s economy could overcome the short-term fluctuations, and continue to witness strong resilience and vitality.
(Contributing Expert: Guo Yingfeng, associate research fellow at China Center for International Economic Exchanges)
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