China’s resurgent economic growth will be a boon to the world in 2023
China’s GDP expanded by 3 per cent year on year in 2022 – better than many major economies – climbed above the 120 trillion yuan (US$17.8 trillion) mark for the first time as the economy navigated rough waters throughout the year and overcame headwinds from the Covid-19 pandemic and geopolitical tensions.
Looking to 2023, China’s economy will see a robust improvement as the better-than-expected, hard-won growth from last year has demonstrated its resilience. With strong positive signals seen in China’s market and policies in recent weeks, the nation’s dual role as a stabiliser and locomotive of the global economy has been further highlighted.
China’s reopening has fuelled optimism over global growth. The seven-day Chinese New Year holiday saw the country’s pent-up travel demand unleashed, with vast numbers of tourists again seen across the country and overseas. A total of 308 million domestic trips were made during the week, almost 90 per cent of the 2019 figure before the pandemic began. Outbound flight bookings rose 6.7 times over the 2022 level.
About 90 per cent of Chinese cinemas have reopened, and box office takings during the holiday reached more than 6.7 billion yuan, the second-highest gross figure for the holiday to date. China’s January box office takings topped 10 billion yuan, a record high for the month. Restaurants also witnessed a more than 50 per cent rise in customers year on year during the Spring Festival holiday.
These numbers are evidence against any proclamations of doom about China’s economy. The world’s second-largest economy has shrugged off the epidemic clouds and is now firing on all cylinders.
As inflation issues in developed markets loom larger, there is an increasingly prevalent view that China’s economic growth will be the main hedge against the risk of global economic recession.
The United Nations projects the Chinese economy will drive regional growth in 2023 with a 4.8 per cent growth rate. The International Monetary Fund raised China’s growth forecast to 5.2 per cent and said the country could be the biggest driver of global growth this year. Foreign firms such as Morgan Stanley and Goldman Sachs are bullish on China’s economy and have lifted their growth outlook to more than 5 per cent.
Meanwhile, China’s supportive policies have boosted business confidence. With private enterprises suffering more difficulties since the outbreak of Covid-19, China’s tone-setting annual central economic work conference last December stressed the need to support the private economy and protect the rights and interests of private enterprises.
Given the rising cases of global protectionism, the world pays close attention to China’s foreign investment policy. The economic conference called for attracting more foreign capital and also made plans to expand China’s market access, ensure national treatment of foreign-funded enterprises and strengthen protection of foreign capital.
A State Council executive meeting on January 28 called for sustained efforts to implement the new Catalogue of Encouraged Industries for Foreign Investment and to facilitate the cross-border flow of personnel. Foreign investors will see lower thresholds and a better business environment in China.
At the beginning of 2023, executives from 21 Chinese companies in the private sector expressed their strong confidence in China’s economy. Foreign enterprises also remain optimistic about China’s future. According to a poll of 160 foreign companies and chambers in December, conducted by the China Council for the Promotion of International Trade, 99.4 per cent said they were confident about China’s economy in 2023 and 98.7 per cent said they intended to maintain and expand their investments in China.
This year marks the 45th anniversary of China’s “reform and opening up” policy, as well as the 10th anniversary of the proposal of the Belt and Road Initiative. As a “super connector” between the mainland and the world, Hong Kong has much to contribute to the country’s high-quality development and the world’s economic recovery in the coming year.
As the border between Hong Kong and the mainland progressively reopens, the central government will not hesitate to further support Hong Kong in enhancing its status as a global financial, shipping and trade centre. It will protect its free, open and fair business environment and ensure that its common law system is maintained, innovation and industrial upgrading advanced and its international linkages expanded.
The Commissioner’s Office of the Ministry of Foreign Affairs in Hong Kong will continue to use its diplomatic expertise for win-win cooperation between Hong Kong and the international community. International stakeholders will have much to gain as long as they make best use of Hong Kong’s broad stage and unique strengths.
While the global outlook is downbeat, China’s growth will be the light at the end of the tunnel. According to the Chinese calendar, this is the Year of the Rabbit. The fourth animal in the zodiac symbolises hope, peace, vigour and vitality. Let us waste no time and work together to make this a year when all our strengths are pooled to revive the world economy. The mainland and Hong Kong stand ready.