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China's Economic Outlook Remains Positive

By Qiushi Commentary Source: English Edition of Qiushi Journal Updated: 2022-07-12

As socialism with Chinese characteristics has entered a new era, China's economy has shifted from a stage of high-speed growth to one of high-quality development. In terms of our development trend, the economy is stable, improving, and has long-term growth potential. President Xi Jinping has repeatedly emphasized that these fundamentals of China's economy remain positive and we need to continue pursuing progress while ensuring stability and to capitalize upon stability by forging ahead. 

Confronted with the complexities of the greatest changes and most serious pandemic in a century, the Central Committee of the Communist Party of China (CPC) with Xi Jinping at its core has kept the country's economy on an even keel by showing strong leadership, coordinating containment of the pandemic with development of the economy and society, strengthening corresponding macro-policies, maintaining stability on six fronts (employment, the financial sector, foreign trade, foreign investment, domestic investment, and market expectations), and putting focus on six priorities (job security, basic living needs, operations of market entities, food and energy security, stable industrial and supply chains, and the normal functioning of primary-level governments). China was the first major economy in the world to return to growth after the outbreak of Covid-19. It was the only major economy to achieve positive economic growth in 2020, and it had one of the highest rates of economic growth among the world's major economies in 2021. In the first quarter of 2022, China's GDP grew by 4.8% year-on-year, 2.85 million new urban jobs were created, fixed-asset investment (excluding rural households) increased by 9.3% year-on-year, and the added value of large-scale high-tech manufacturing increased by 14.2% year-on-year, all of which underline our economic stability. These achievements have boosted the confidence of the Chinese people to pursue progress amid stability and strengthened our determination to surmount difficulties. 

Profound and complex changes are occurring at home and abroad, posing increasing risks and challenges to China's economy. Economic development faces the threefold pressure of contracting demand, supply difficulties, and weakening expectations. The economic development environment is becoming more complex, severe, and uncertain, and we face new challenges in stabilizing growth, employment, and prices. Global inflationary pressures have grown significantly, and the risk of spillover effects from major economies tightening their monetary policies has increased. As a result, the global economic recovery is slowing and financial market volatility is rising. We must pay attention and respond calmly to these risks and challenges. In times of difficulty, it is even more important that we maintain our strategic resolve and draw strength from the bright spots in China's economy. These risks and challenges do not alter the fundamentals of China's economic stability and long-term prospects, nor will they hinder our steady economic progress. 

Strong leadership of the CPC 

The CPC's centralized and unified leadership over economic work provides a fundamental political guarantee for China to cope with major risks and challenges and maintain sustainable and healthy economic development. Under the Party's leadership, the Chinese people have achieved the rare combination of rapid economic development and long-term social stability, pioneered a uniquely Chinese path to modernization, and created a new model for human advancement. Since the CPC's 18th National Congress in 2012, the CPC Central Committee led by Xi Jinping has exercised overall leadership and coordinated all aspects of economic work, strengthened analysis and deepened understanding of China's overall development situation, and calmly responded to major risks and challenges. It has also promptly formulated major policies and strategies, issued crucial decisions, and assigned important tasks to ensure that China's economy remains on track toward healthy development. 

Sound guidance of rational thinking 

With rational concepts and theories, it is possible to grasp principles, guide practice, and seize the initiative in development. Since the CPC's 18th National Congress, despite facing extremely complex domestic and international economic environments, the CPC Central Committee has drawn rational conclusions regarding economic development, made decisions on major policies and principles of economic work, and carried out timely adjustments to development thinking. It has also continuously deepened our understanding of the laws of economic development and formed Xi Jinping's economic thought through practice. Xi Jinping's economic thought prescribes that we must uphold and improve the basic socialist economic system, which enables the market to play the decisive role in resource allocation and better harnesses the role of government. It has facilitated a firm grasp of the new stage of development as well as implementation of the new philosophy of innovative, coordinated, green, open, and shared development. It has accelerated the shaping of a new development dynamic that focuses on domestic economic flows and features positive interplay between domestic and international flows, promotes high-quality development, and coordinates development and security. These important strategic concepts and theories have greatly deepened our understanding of the laws governing the development of the socialist economy with Chinese characteristics. 

Manifesting the strengths of China's socialist system 

Elements of the basic socialist economic system, including public ownership playing the dominant role while ownership in multiple forms developing side by side, an income distribution system which is centered on labor-based distribution while allowing other forms of distribution to coexist, and the socialist market economy, not only incentivize market entities and liberate and develop productive forces, they are also efficient and fair and conducive to common prosperity. As such, they provide strong institutional guarantees for economic stability and long-term improvement. The remarkable strengths of Chinese socialism have been fully demonstrated by our coordination of pandemic containment efforts with economic and social development objectives. China has been in the front ranks among countries in the world in containing Covid-19 as well as the global economic recovery, casting into sharp relief the order in China and disorder in the West. 

Solid foundations from sustained and rapid development 

The continuous improvement of our overall national strength, including the strengthening of our economy, and development in science, technology, and national defense, coupled with our huge market, gives China's economy ample room to maneuver and our economic development great resilience, vitality, and potential. In 2021, China accounted for more than 18% of global GDP, the second highest share in the world. China also has the world's most comprehensive industrial system. Our annual grain output has remained above 650 million metric tons for seven consecutive years, we have the world's largest manufacturing output, and we have built the largest 5G, high-speed rail, and expressway networks in the world. All these achievements provide a solid foundation for maintaining China's economic stability and long-term improvement. 

Social environment of long-term stability 

The CPC insists on the primacy of the people. It is striving to improve people's standard of living and enhance their wellbeing by developing the economy, achieving notable improvements in people's sense of fulfillment, happiness, and security. Social governance in China is continuously improving and good social order is being created, which have ensured enduring social stability and created a positive social environment for economic growth. Today, China enjoys a stable political environment and a peaceful society, and it is recognized by the international community as one of the world's safest countries. The long-standing stability of Chinese society is conducive to economic development, and a secure and stable China will continue to generate robust development momentum. 

Spirit of self-confidence and self-improvement 

Led by the CPC Central Committee, people across the country strengthened their self-confidence and self-improvement, and made innovations based on past successes, thus achieving the goal of building a moderately prosperous society in all respects as planned. Under CPC leadership, China's overall national strength, its people's living standards, and its international reputation have reached new heights, with historic achievements and changes registered for our Party and country. As we embark on the new journey to achieve the Second Centenary Goal, the Chinese people have even greater enthusiasm, initiative, and creativity as well as unprecedented levels of aspiration, motivation, and determination, and the spirits of the Party, military, and people are soaring. 

Fundamentally, China's economic stability and long-term improvement are the result of the historical position, development foundation, political safeguards, and institutional advantages that China enjoys in the stage of high-quality development. They are also a reflection of the overarching logic and trend of China's economic development. They will not change because of short-term economic fluctuations or complexities and variables. Considering our basic conditions, including domestic and international imperatives, our history and present reality, as well as subjective and objective factors, there is every reason to believe that China's economy will remain stable and is on a positive trajectory. 

(Originally appeared in Qiushi Journal, Chinese edition, No. 10, 2022)