China Plays Down Concern Over, Its Economic Slowdown, Claims Rebound Of Its Economy

China on Monday claimed a rebound of its economy and promised more opening up for foreign investments as the key Congress of the ruling Communist Party deliberated a new economic policy to stabilise the world's second-largest economy. Over 2,300 delegates attending the 20th congress of the Communist Party of China (CPC), which is due to endorse an unprecedented third term for President Xi Jinping deliberated on domestic policies on the second day of the week-long session here on Monday.

The International Monetary Fund and the World Bank have slashed their 2022 growth outlook for China to 3.2 per cent and 2.8 per cent respectively, far below the 5.5 per cent target fixed by the government. The slowdown was exasperated by Xi's rigid zero-COVID policy which in the last one year resulted in periodic lockdowns of various top Chinese cities including business hubs like Shanghai, disrupting industries and supply chains.

In his address to the Congress on Sunday, Xi defended the zero-COVID policy, saying it saved people's lives but gave no indication of its relaxation. He also said the country will move faster to build a modernised economy. China will raise total factor productivity, make industrial and supply chains more resilient and secure, and promote integrated urban-rural development and coordinated regional development, so as to effectively upgrade and appropriately expand economic output, Xi said.

Playing down the concerns of slowdown Zhao Chenxin, deputy director of China's economic planning body the National Development and Reform Commission, said: "from what we know so far, the economy rebounded significantly in the third quarter, and from a global point of view, China's economic performance is still outstanding." He told a press conference here on the sidelines of the party Congress that China's economic situation contrasted sharply with much of the world with consumer inflation only marginal, the job market steady and international payments stable.

He was reacting to reports that the unemployment rate in China touched around 19 per cent, the highest in decades due to the economic slowdown. China has to constantly expand the job market to provide jobs to about 11 million youth coming out of colleges and universities annually. The CPC takes employment-related issues seriously as it apprehends youth unrest threatening its one-party rule. Zhao said China continues to advance foreign investment and opening up to bolster the economy.

China is going to release the 6th list of major foreign investment projects, as part of its latest efforts to promote foreign investment and expand high-level opening-up, Zhao said. The list of major foreign investment projects was first released in 2018 and has since then been issued occasionally. He also said the Chinese authorities will coordinate in a timely manner to address difficulties facing such projects in investment, production and operation to ensure the smooth implementation of said foreign investment projects.

"We will advance high-level opening-up and strengthen policies attracting foreign investment to better unleash the potential of foreign investment in promoting high-quality development and smoothing domestic and international circulations," he said. He added that more efforts will be made to solve prominent problems facing foreign investors and improve services and promotion in all respects for foreign investment, to promote high-quality development of foreign investment.

He said China will unswervingly expand all-around opening up and push economic globalisation toward being more open, inclusive, balanced and beneficial to all. There has been a misunderstanding about China's new pattern of development that is focused on the domestic economy and features positive interplay between domestic and international economic flows, Zhao said.

It is wrong to think that by focusing on the domestic economy China will scale back its opening-up efforts or even turn to a "self-sufficient economy," said Zhao. Economic globalisation has become an irreversible trend, he said, adding that China is already deeply integrated into the global economy and the international system, and the industries of China and many other countries are highly interconnected and interdependent.

(PTI)