British economist: "Double cycle" into China's development tool Foreign companies optimistic about 2023 hot start
The first session of the 14th National People's Congress and the first session of the 14th National Committee of the CPPCC opened in Beijing on March 5 and March 4, 2023, respectively.
On March 14, British economist Colin Speakman wrote an article, in the face of the very challenging international environment, China's "dual cycle" policy will help it achieve economic growth targets. China, which can control its own economic destiny through its large domestic market and targeted government policies, will be an important driver of global growth in 2023.
Speakman said the optimization of China's epidemic prevention and control policy by the end of 2022 provides favorable conditions for economic growth in 2023. In 2022, with major Western countries struggling to emerge from recession, the government work report released at this year's annual meeting of the two sessions of the Chinese People's Congress (NPC) highlighted China's full-year GDP growth of 3 per cent last year and its economic growth target of around 5 per cent this year.
In the 14th Five-Year Plan for National Economic and Social Development and the Outline of 2035 Goals of the People's Republic of China issued in March 2021, it is proposed to adhere to the strategic basis of expanding domestic demand, accelerate the cultivation of a complete domestic demand system, and organically combine the implementation of the strategy of expanding domestic demand with deepening supply-side structural reform. We will promote innovation-driven, high-quality supply and create new demand, and accelerate the building of a new pattern of development in which the domestic cycle plays a leading role and the domestic and international cycles reinforce each other. As a result, the article said, with targeted policies, China's domestic growth can be achieved without being seriously affected by international turmoil. The policy also looks for opportunities to boost the overall economy through international activity.
In 2023, the Chinese government will implement a proactive fiscal policy to support the domestic growth target of around 5 percent, and a prudent monetary policy to ensure inflation remains at a low level, the article said. However, international economic relations are still important to China, which supports globalization. China's exports have historically played an important role in economic growth and it wants to play its part in providing its trading partners with quality import opportunities.
In this year's government Work report, China said it would make greater efforts to attract and utilize foreign investment. With many leading technologies, a skilled labor force and a huge domestic market, China is a highly attractive country for foreign investment. In addition, China will further open up the modern service sector and promote the construction of landmark projects funded by foreign investment. To further promote the internationalization of the dual-cycle policy, China will also actively promote its accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
In response, a number of foreign companies said they have had a good start in 2023, and are looking forward to strong business growth and increased competition in the Chinese market. Arno van der Merwe, CEO and president of Beijing Benz Automobile Co, said the company has returned to a completely normal operating environment, made a "good start" in 2023 and is looking forward to a very strong year in business, Xinhua reported. In addition, they have transformed their assembly lines to meet the growing demands of China's huge new-energy vehicle market. Referring to a number of domestic new-energy vehicle producers, he said he believes competition will help make the market more mature and promote high-quality economic recovery.
Sami Atiya, president of robotics and discrete automation business area at Swiss tech giant ABB, said: "China's massive investment in industrial robots has brought the country into the top five in robot density for the first time. China is the fastest growing robot market in the world and its robot density is expected to double by 2025." He added that the unprecedented demand for automation among Chinese companies provides great assurance for the company's long-term investment in China.
At the end of the article, Speakman concludes that China can control its economic destiny through its large domestic market and targeted government policies while dealing with a challenging international environment. Its growth rate could once again be the highest among major economies. This will be an important driver of global growth in 2023.