China takes prompt actions to stabilize growth amid tests
China is putting stabilizing growth in a more prominent position, while it seeks to better coordinate COVID-19 control and social and economic development, at a critical juncture that can determine the economic outcome of 2022.
At a national teleconference Wednesday, Premier Li Keqiang underlined the need to earnestly implement policies to stabilize the economy and support market entities, employment and people's livelihoods.
He urged swift actions from now on to get the economy back on track, while acknowledging that the difficulties since March are in some respects and to a certain extent greater than those experienced in 2020 when the COVID-19 epidemic hit the country.
The importance of maintaining stable growth stands out even more at a time of heightened volatility and uncertainties from home and abroad, officials and analysts say, adding that China has the condition and is taking prompt actions to achieve the goal.
At Wednesday's teleconference, Premier Li underlined the urgency of the 33 measures to stabilize the economy proposed at an earlier State Council executive meeting, ordering government departments to introduce practical implementation measures by the end of May.
Analysts say the meeting sent clear signals of taking concrete steps to stabilize growth, especially at the primary levels. The China International Capital Corporation (CICC) believes that these pro-growth policies, some of them stronger than those in 2020, will help buoy recovery in the second half of the year given effective COVID-19 control.
Authorities are on the move, unveiling detailed measures to put existing assets to better use, grant financial aid to domestic airlines, and ramp up financial support to struggling businesses.
Many local governments including in the provinces of Hubei, Hunan and Zhejiang also responded by working out region-specific moves.
Shanghai, for instance, unveiled 50 measures on Sunday to speed up economic recovery. It pledged to promote work resumption in all sectors by expanding the scope of subsidies for enterprises' epidemic prevention and disinfection, stabilizing industrial and supply chains in the Yangtze River Delta, and smoothing domestic and international logistics and transportation channels.
As local governments are instructed to basically utilize special bonds by the end of August on new infrastructure and other projects, the CICC estimated in a report that infrastructure investment this year could climb 8 percent to 10 percent from a year ago, faster than the 0.2-percent expansion recorded last year.
FAVORABLE CONDITIONS ABOUND
While domestic COVID-19 flare-ups dampened the readings of such indicators as employment, industrial production, power consumption and cargo transportation in April, a closer look into the country's economic status reveals the sound foundation for stable growth in both near and longer terms.
Market supply of commodities is generally sufficient. Spring farming is in steady progress, with grain seeds sown on 92.5 percent of intended acreage for spring farming by May 23, up 2.4 percentage points from a year ago, and summer harvest has begun in major breadbasket provinces. The output of raw coal, crude oil and natural gas maintained robust year-on-year growth in April.
Inflation is tame against soaring prices globally. The investment proved able to shore up growth, with manufacturing and infrastructure investment jumping 12.2 percent and 6.5 percent year on year during the first four months, respectively.
Emerging growth drivers stood undaunted in front of COVID-19 disruptions. High-tech industries posted stellar performances, with the production of new energy vehicles and solar cells surging 42.2 percent and 20.8 percent year on year in April.
Domestic demand is expected to be driven by the 102 major projects slated through 2025, as the country's urbanization carries on. Its industrial and supply chain strengths are more grounded as it nurtures a bevy of emerging small and medium-sized tech-savvy manufacturing enterprises specializing in niche markets.
Few foreign investors are willing to miss out on the opportunities China's super-large market has to offer. In the first four months, foreign direct investment into the Chinese mainland, in actual use, expanded 20.5 percent year on year, official data showed.
STABLE GROWTH IS KEY
Development is the key to solving all problems in China, said Li at the teleconference.
Since 2012, China has more than doubled its gross domestic product to account for over 18 percent of the global total in 2021. It has also lifted its people out of absolute poverty.
The country has one general principle to thank for these concrete achievements -- seeking progress while maintaining stability. Over the past decade, stable economic growth has provided a nurturing environment for deepening structural reforms, which in turn provided lasting growth impetus.
Going into 2022, it remained the overarching tone of economic endeavors, as it was reiterated in this year's government work report and by Chinese leadership on multiple occasions.
Stable growth of the world's second-largest economy will serve as a shot in the arm for global recovery.
Acknowledging "additional weakness in the global economy," Gita Gopinath, the first deputy managing director of the International Monetary Fund, said if China can deal with the near-term headwinds in terms of COVID-19 and others, it will remain one of the important engines of growth.