Source: Global Times Published: 2024-07-17

By Zhou Rong

Global confidence in stable growth in China's economy has remained unchanged, as some international organizations and multinational banks have projected 5 percent GDP growth in China in 2024, thanks to remarkable performances in areas such as exports, even as many major economies and the global economy as a whole face serious downward pressure.

While some foreign banks and Western media outlets, in particular, have painted a gloomier outlook for the world's second-largest economy following a slowdown in growth in the second quarter, experts said that such pessimistic views are only based on short-term fluctuations and grossly overlook the resilience and vitality of the Chinese economy.

The overwhelming view among Chinese economists and many domestic and foreign institutions is that despite lingering challenges arising from the global economic downturn, China will be able to achieve its annual growth target of around 5 percent, and the outlook will become increasingly brighter as the third plenary session of the 20th Communist Party of China Central Committee is expected to roll out reform measures to tackle challenges and promote high-quality development in the long term.

On Tuesday, the IMF raised China's GDP growth forecast for 2024 to 5 percent in its latest World Economic Outlook (WEO), an upward revision of 0.4 percentage points compared with the April WEO report.

'In China, resurgent domestic consumption propelled the positive upside in the first quarter, aided by what looked to be a temporary surge in exports belatedly reconnecting with last year's rise in global demand,' said the IMF WEO, which was shared with the Global Times.

On Monday, HSBC, a multinational bank, said in a report that it expects China to achieve its annual GDP growth target of 5 percent, while noting that China's industrial production and manufacturing investment have become the highlights of economic activity in the nation.

Liu Jing, HSBC's Chief Economist for Greater China, said that despite endless reports of trade restrictions, China's importance as a crucial supplier of commodities to the world has become increasingly prominent, and its market share has continued to expand, according to a report from HSBC sent to the Global Times.

Xu Hongcai, deputy director of the China Association of Policy Science's Economic Policy Committee, said that the reasoning behind improving confidence in China's growth prospects is 'very simple.'

'China's GDP growth rate reached 5 percent in the first half of the year, so if we maintain overall stable economic operations in the second half, we will be able to achieve the annual growth of around 5 percent,' Xu told the Global Times on Wednesday.

The upbeat forecasts for China's 2024 GDP growth came as Chinese official data showed on Monday that GDP expanded by 5 percent year-on-year in the first half to 61.68 trillion yuan ($8.49 trillion), thanks to robust 5.3 percent growth in the first quarter and a slightly lower growth rate of 4.7 percent in the second quarter.

Some Western media outlets and foreign institutions have seized on the slowdown in second-quarter growth to paint a rather gloomy outlook, with some even claiming that China's economy is 'faltering.'

However, Chinese economists refuted such pessimistic views, saying they only focus on short-term challenges and ignore the resilience and advantages of the Chinese economy.

'Foreign media organizations often only see the difficulties China faces, but ignore China's determination and ability to overcome these difficulties. They overestimate the negative impact of these difficulties on China's economy and underestimate the Chinese people's ability to solve problems and make actual achievements,' Zhou Rong, a senior researcher at the Chongyang Institute for Financial Studies at Renmin University of China, told the Global Times on Wednesday.

In addition to robust industrial production and manufacturing capabilities, experts highlighted China's clear competitive edge in emerging industries such as new energy and big data, which will underpin China's high-quality development in the long run.

Meanwhile, the ongoing third plenary session of the 20th CPC Central Committee, which is set to conclude on Thursday, is also helping boost confidence in China's long-term growth prospects, as the critical meeting is expected to create a blueprint for deepening reform and expanding opening-up, which are considered crucial driving forces for development.

Zhou said that the third plenary session marks a milestone in China's development, as it will roll out major reform and opening-up measures for the years to come.

In the shorter term, many economists believe that policy support for growth will further intensify in the second half of 2024, in order to tackle challenges and achieve the nation's annual development goals.

Overall, China's economic prospects are bright, and it is important to understand China's development potential and stable policy environment, Zhou said.