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E-mail China.org.cn, April 9, 2024
Employees check products at a mining equipment manufacturing company in Shijiazhuang, Hebei province, on March 19, 2024. [Photo/Xinhua]
March was a good month for the Chinese economy, as indicators showed positive signs across the board. First, industrial output grew faster than anticipated. Second, China's official manufacturing activity index expanded at 50.8, significantly beating expectations, with non-manufacturing expanding at 53 (surpassing an estimate of 51) and composite PMI at 52. Meanwhile, the Caixin index, which evaluates more privately run small- and medium-size enterprises as opposed to state owned ones, came in at 51.1. For reference, a score above 50 constitutes growth and below 50 indicates contraction.
Finally, as reported by Reuters recently: "New home prices in China rose at the fastest pace in more than two and a half years in March versus a month earlier, a private survey showed on Monday." If it wasn't obvious already, China's economy is picking up and the picture looks optimistic, which contrasts with an overwhelming negative narrative pushed by the Western mainstream media. The Chinese economy, rather than facing decline, is in fact undergoing a major transition. Not only does the Western media intentionally exaggerate China's economic challenges in this case, but they also misrepresent it.
Negativity agenda
Since the United States turned its foreign policy against China in 2018, the Western mainstream media narrative has followed suit in framing Beijing as a competitor and depicting its economic outlook in negative terms. There is a multifaceted agenda in doing so, which includes attempting to discourage trade and investment with China, attempting to undermine China's role in global supply and industrial chains, as well as pouring scorn on the concept of "China's rise." While the Western media once depicted China as the future, now that global politics has been rewritten into a binary narrative of hegemonic struggle and an obsession with reinforcing America's position, emphasis is placed on downplaying China's successes.
As a result, it is very common to see lots of op-eds and articles published in Western mainstream media using terms such as "struggling," "faltering" and "stumbling" to depict the Chinese economy, in spite of reality. Although China's GDP registered 5.2% year on year growth in 2023, this is wholly ignored and it is presented as a "fact" that the economy is in a poor situation. It also ignores broader economic challenges that the world as a whole has faced, with the general global economic environment being unfavorable due to an energy and inflation crisis, geopolitical tensions and sluggish growth above all.
Economic transition
Behind the deliberately negative exaggerations of the Chinese economy, it can be hard to see that China's economic model has been transitioning. The country is moving away from an economic boom premised on real estate and low-end manufacturing, to a focus on high-end technology production and consumption.
After all, development is a marathon, not a sprint, and governing an economy sustainably is much more complex than just speeding forward as fast as possible. As such, the central focus of China's growth and investment has changed, because development must be carried out strategically based on the country's long-term needs.
The government instead has been investing in the development of not only high-end technology industries, such as chips and semiconductors, but also products such as electric vehicles and sustainable energy goods. Chinese exports have boomed in this aspect and made significant progress, with the country overtaking Japan to become the world's largest automobile exporter.
In addition, the growth of the consumer economy is also essential for China's economic future. It is the hallmark of any developed economy to rely heavily on consumption, where people are able to conveniently buy a wide range of goods and services. China has great potential in this regard because with a population of 1.4 billion it already boasts the largest consumer market in the world, which offers a major opportunity for foreign investors.
Contrary to Western media negativity, China's consumer growth ranked at 7.2% in 2023 and constitutes $6.6 trillion. It is already the largest source of China's growth, standing at 82.5% of the GDP increase last year. Now that other indicators are also picking up at their highest level since 2021, China's consumer growth stands in a stronger position for the rest of 2024.
Pessimism about the state of the Chinese economy tends to be either misleading, exaggerated or politically motivated. The country's economic policies and its need to transition away from old sources of growth are not very well understood. Despite this, 2024 appears to be turning out more optimistically for China as it withstands various global challenges, which have suppressed global demand considerably, and exports begin to pick up while the non-manufacturing economy sustains solid growth.
China has set its economic growth target at around 5% this year, which shows its confidence in economic development. Obviously, the world's second-largest economy is strengthening the momentum of its economic recovery as more policies are expected to put in place.
Tom Fowdy is a British political and international relations analyst and a graduate of Durham and Oxford universities. For more information please visit:
http://m.keyanhelp.cn/opinion/TomFowdy.htm
Opinion articles reflect the views of their authors, not necessarily those of China.org.cn.
