China’s Economic Outlook: Insights In Growth And Global Impact
Distinguished experts offered valuable insights on the current state and prospects of the Chinese economy on the final day of the World Economic Forum’s Annual Meeting of the New Champions ahead of a much-anticipated policy meeting next month in Beijing.
Aparna Bharadwaj, Managing Director and Partner, Global Leader for the Global Advantage Practice, Boston Consulting Group, Singapore, noted that even China’s relatively modest 5% growth target for 2024 – a target affirmed by Chinese Premier Li Qiang in the meeting’s opening plenary – needed to be put in perspective. “Five per cent growth will already add more to the global GDP than India, Indonesia and Japan combined,” she said. “So even a so-called slowed down growth of China is actually incredibly relevant for the global economy.”
Beijing’s oft-used phrase “high-quality growth” is more than just a popular buzzword, said Peng Sen, President, China Society of Economic Reform (CSER). “This is about advanced productivity. It is about innovation.” Future growth for China’s industries requires “revolutionary transformation on the technological front,” he added, and will focus on cutting-edge tech such as generative AI and advanced chips. He cited the current buildout of a national computing network to address surging demand for computing power and big data.
Keyu Jin, Professor of Economics at the London School of Economics and Political Science, said: “There is a fundamental structural change that is under way that has to do with new technologies, and that has to do with climate change.” Emphasizing the fundamentally global nature of these foundational technologies in the green energy transition, Jin said: “China might be leading the way in EVs, batteries and solar panels, but they are all embedded in a global supply chain. It’s going to involve everybody.”
The globalized nature of these vital sectors has raised some challenges, said Eswar Prasad, Professor of Cornell University. Geopolitical tensions have been heightened by the fact that China, the United States and Europe are on similar paths towards the revival and upgrade of manufacturing. “Many of the industries that China is looking to develop for its own technological upgrade, for its own move up the value-added chain – green technology, solar, batteries, EVs – are precisely the industries that the United States and perhaps even Europe are counting on for their own manufacturing revival,” Prasad said.
Looking to the near term, Peng Sen highlighted July’s upcoming economic policy meeting in Beijing, in which he expects positive signals from the government on Chinese growth, as an event to watch.