|China prioritizes economic quality while optimizing COVID-control measures|
Staff members sort packages at a logistics company in Huzhou, Zhejiang Province, on December 12 (XINHUA)
In the last couple of months, Zhao Xianmei, General Manager of Beloved, a company focusing on artificial intelligence healthcare products, based in Guangzhou, Guangdong Province, has been busy flying to industrial exhibitions in different countries, one after another, in the hope of signing new deals with potential international partners.
In contrast to her independent business travel in previous years, Zhao has been making these trips on charter flights together with representatives of other enterprises in Guangdong. These charter flights have been organized by Guangzhou Municipal Commerce Bureau in cooperation with other local authorities.
In addition to chartering the flights to participate in exhibitions and visit industrial parks and chambers of commerce overseas, the authorities also conduct market research on behalf of the companies. This has allowed the companies to continue to do business internationally, and several other provinces have adopted similar measures.
"We hope that government departments can provide companies with more opportunities so that they are more confident and willing to embrace the post-pandemic international market, and find more opportunities to compete and cooperate internationally in the coming year," said Li Lin, head of one such delegation from Zhejiang Province. She said the delegation was organized to meet the needs of enterprises as identified in surveys.
More of these delegations have been organized after December 7, when China's central authorities issued a notice on 10 new measures to further optimize its COVID-19 response. These range from allowing home quarantine for mild and asymptomatic cases to reducing the need for mandatory nucleic acid tests to make it easier for people to travel and enter public venues. The new measures have eased restrictions on social and economic activities and are gradually bringing people's lives and businesses back to normal.
Better coordination of pandemic prevention and control and economic and social development was stressed at a meeting convened by the Political Bureau of the Communist Party of China Central Committee on December 6, which discussed economic work in the next year. According to the meeting, in 2023, all policies, including those regarding pandemic prevention and control, will be further optimized to promote high-quality development.
A technician monitors operation at a data center in Gui'an New Area, Guizhou Province, on May 24, 2021 (XINHUA)
The meeting on December 6 emphasized that the country will pay special attention to ensuring steady growth, employment and prices; forestall and defuse major risks, and strive to achieve higher quality growth. Additionally, proactive fiscal policy and prudent monetary policy will be continuously rolled out to pursue steady economic progress.
One of the focuses in the next year will be boosting domestic consumption, Wei Xiang, a professor at the National Academy of Economic Strategy under the Chinese Academy of Social Sciences, told Beijing Review. "Accordingly, expanding employment, issuing digital coupons for buying goods and services, and optimizing taxes, especially individual income tax systems, can bring about tangible results," he said.
The measure has already been in place for a long time amid the resurgence of the pandemic. For example, since mid-July, Beijing local government has issued 100 million yuan ($14.32 million) in coupons for restaurants and other food and beverage venues and 30 million yuan ($4.3 million) in coupons for accommodation outside urban areas, which has bolstered businesses in hospitality, culture and leisure tourism. Some cities have issued coupons or other forms of subsidies for purchasing houses and vehicles, some up to 2,000 yuan ($286) or even higher.
However, the pandemic-induced economic slowdown has affected people's personal finances. "In the past few years, due to changes in the global trade environment, the pandemic and the slowing growth of incomes, the growth rate of consumption has not been satisfactory," said Zhu Ning, Deputy Dean of Shanghai Advanced Institute of Finance at Shanghai Jiao Tong University.
In the third quarter of this year, household wealth and income increased, but the growth rate dropped significantly compared with the previous quarter, according to a recent survey conducted by the Survey and Research Center for China Household Finance at the Southwestern University of Finance and Economics and a research institute under the Ant Group, a financial affiliate of the Alibaba Group.
The survey also showed that household consumption rose in the third quarter, yet at a slower rate than in the second quarter; consumption of daily necessities, transportation, communication, education and healthcare continued to grow, while leisure consumption including tourism and entertainment also recovered, albeit more slowly.
The number of domestic tourist visits in the first three quarters of this year was 2.09 billion, a decrease of 595 million from the same period of 2021, or 22.1 percent year on year, according to a domestic tourism sampling survey conducted by the China Tourism Academy. "2022 is the year that the tourism industry has been most affected by the pandemic in the past three years," He Qiongfeng, head of the academy's statistics analysis department, told China National Radio.
In spite of the challenges ahead, the market has already shown an upward trend. On December 5, many provinces across China reported that more than 70 percent of local movie theaters had reopened, according to data from ticketing service agency Maoyan.
From January 2020 to October 2022, the Central Government released many guiding documents on encouraging the transformation and high-quality development of the tourism industry, He said, adding "It is expected that in 2023, especially in the second half of the year, domestic tourism will see a rise."
An elderly resident receives a shot of COVID-19 vaccine in Shanghai on December 9 (XINHUA)
Ensuring steady employment will be a focus for China in the next year. China's surveyed urban unemployment rate stood at 5.5 percent in October, unchanged from the September level, data from the National Bureau of Statistics showed on November 15.
The surveyed unemployment rate among those aged between 25 and 59, which constitute the majority of the labor market, came in at 4.7 percent in October, also unchanged from the previous month. In the first 10 months of the year, the average surveyed urban unemployment rate was 5.6 percent.
"Now we need to focus on nurturing high-quality industrial development, which can drive high-quality employment," Wei said.
Different regions should make use of their local advantages and develop industries that will make them stand out and become more competitive, rather than following examples from other regions that may not be suitable, Wei said.
In the past decade, authorities in Guizhou Province have invested heavily in tourism. From 2016 to 2019, the province's tourism revenue grew at a rate of more than 30 percent, the fastest growth period in the history of the province. While Wei and a colleague were conducting field research in the province, provincial government staff told them that the incomes of local people had increased due to tourism.
Now the province is making big strides in the big data industry, which is growing fast due to factors including the province's cooler summer weather that is friendly to the equipment, ample power and stable geological structure.
The province is home to one of the 10 national data center clusters established as part of a national mega project. Launched in February, the project aims to coordinate computing capabilities between the coastal provinces in the east and the western inland regions to improve overall computing power. As a result, cloud computing has become a pillar industry in Guizhou.
"Developing such a high-quality industry helps boost tourism and employment. Other provinces should find their own paths to success based on their local strengths as well," Wei added.
While calling for further expansion of domestic demand, the meeting on December 6 also emphasized the need to boost opening up at a high level and make greater efforts to attract and utilize foreign investment.
Many localities across China are moving fast to boost foreign trade and investment. In addition to sending business delegations to meet with overseas customers or investors, they are also holding foreign investment promotional activities. Shenzhen, a manufacturing and tech hub bordering Hong Kong, secured 879 billion yuan ($126 billion) in foreign investment at the 2022 Shenzhen Global Investment Promotion Conference on December 9, held to boost global investor confidence in the city's future development. Investment agreements made during the conference involve 315 projects and top global investors such as Amazon, Intel and A.P. Moller-Maersk.
In the first 11 months of this year, China's trade in goods expanded 8.6 percent year on year to 38.34 trillion yuan ($5.51 trillion), according to the General Administration of Customs of China. Its economy has grown at an average annual rate of more than 5 percent over the past two years, better than the global average.
Facing increasing uncertainty in international markets, many global companies continue to rely on the Chinese market to maintain their development. One of these, Japanese beauty treatment company Shiseido Group, is increasing its investment in China to develop its innovation capabilities. "We are full of confidence in China's huge potential and are even more committed to our long-term investment in the market," group CEO Masahiko Uotani said in a development plan released on November 15, describing China as a "key engine" of the company's growth.
He Min, an associate professor at China Foreign Affairs University and a specialist in international trade, believes although affected by the pandemic in the short term, in the long run, China's economic fundamentals have not changed. "Its continuously optimizing industrial structure, strong technological innovation momentum, complete infrastructure and industrial supporting facilities, as well as low technology development costs are advantages that few countries can emulate," He told Beijing Review, adding that for quite some time, the country's position as a world factory will not be shaken, nor will its position in the global industrial supply chain.
China has also continued to make its market more accessible to foreign investors, shortening the negative list for foreign investment. It has put into force the Foreign Investment Law, which took effect on the first day of 2020, to protect foreign investors' legitimate rights and interests.
"Now China is sending more signals to the world that its domestic market is stabilizing and improving, and it is pursuing high-level opening up and sharing development opportunities with other countries," she added.
(Print Edition Title: Recalibration for Recovery)
Copyedited by G.P. Wilson
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