Overseas financial institutions are expressing renewed confidence in China’s economic prospects, as the country’s commitment to high-quality growth begins to yield tangible results.
According to the latest data from the National Bureau of Statistics (NBS), China’s Gross Domestic Product (GDP) expanded by 5% year-on-year in the first half of the year. On a seasonally adjusted basis, GDP grew 0.7% in the second quarter, marking the eighth consecutive quarter of positive growth.
“The comparative advantage of the Chinese economy now largely stems from research and innovation,” said Wu Yibing, head of China for Singapore’s state investment company Temasek. “In the past, China’s manufacturing strength was often attributed to its abundant labor force and high production efficiency.”
In the first half of the year, China’s value-added industrial output, a key economic indicator, increased by 6% year-on-year. Notably, the output of the equipment manufacturing sector, which accounts for one-third of the overall industrial output, climbed 7.8% during the same period. The high-tech manufacturing industry also posted strong growth, with its output up by 8.7%.
The production of service robots, smartphones, and new energy vehicles surged by 22.8%, 11.8%, and 34.3% respectively in the first six months, highlighting the country’s advancements in high-tech industries.
A report by Bloomberg on July 16 noted that China’s long-term pursuit of high-quality growth is starting to bear fruit. “Advances in electric vehicles, solar panels, and other high-tech industries have helped keep economic expansion within reach of its targeted pace of around 5%,” the report stated.
Investment and exports have also been notable highlights of China’s economic performance. Ji Mo, chief China economist of DBS Group Research, observed that the effects of large-scale equipment upgrades and trade-in of consumer goods are continuing to manifest. “Effective investment is being driven by the issuance of local government special bonds and ultra-long special treasury bonds,” Ji said.
Data shows that China’s investment in infrastructure construction during the January to June period rose by 5.4% compared to the previous year, while manufacturing investment increased by 9.5%. Additionally, the country’s net exports of goods and services contributed 0.7 percentage points to GDP growth in the same period.
“China has become increasingly important as a major global supplier of goods and has continued to expand its market share despite trade restriction measures,” said Liu Jing, chief economist for Greater China at HSBC.
Experts from multiple overseas financial institutions agree that the accelerated development of new quality productive forces, the continuous release of policy effects, and the recovery of external demand have supported China’s economy. However, they also note that further reform and opening up are needed in the face of challenges such as insufficient effective demand and a complex external environment.
Reference(s):
Foreign financial institutions upbeat on prospects of China's economy
cgtn.com
