The recent World Bank report that "China will overtake the United States to become the largest economy" has triggered global concern. Some are taken aback by the fast-paced growth of the Chinese economy; others question the conclusion that China will become the largest economy.
In fact, in recent years there has been a constant chatter of voices talking down China's economy, especially during its economic slowdown this year.
"Before the first quarter of this year, when the National Bureau of Statistics (NBS) announced its economic growth data, Goldman Sachs had predicted China's economic growth rate would be only 6 percent for the first quarter." Economist Ma Guangyuan says that the figures released by the NBS represented a strong riposte to the international investment bank, but they did not put a stop to the questioning voices.
Asking China to engage in a blind acceleration is unreasonable
At an early stage of the G20 finance ministers and central bank governors meeting held in July last year, a number of European countries expressed the hope that China would take aggressive stimulus measures to improve its growth in order to promote the economic recovery of other countries. Today, there is still a popular sentiment in the West that China should bear the primary burden of supporting international economic growth, ignoring the fact that China's intensive economic development model has run its course.
The reality is that the West has become too dependent on China's rapid growth, and that this growth is not sustainable. Structural contradictions, resource constraints, and environmental pressures, stemming from long-term government investment, are becoming more and more serious. Internal and external demand has declined, and some developed countries are now adopting protectionist measures that have led to a new decline in Chinese exports. Competitive currency devaluation in some developed countries has caused hot money flows, the continued appreciation of the RMB, and imported inflation.
"The argument that China's economic slowdown is a drag on global growth is inconsistent with the facts”, says Xu Hongcai, director of the Information Department of the China Center for International Economic Exchanges.
China's contribution to the global economic recovery and sustainable development is remarkable. China has maintained growth at more than 7 percent, it provides more than 10 million jobs a year, and it is currently the world's biggest economy in terms of foreign trade, all of which contribute to global economic growth.
China to contribute more to the world
With the deepening of China's economic reform, Western countries should gradually adapt to the "new normal" of China's economy, under which: first, China's economy will slow down from rapid growth to moderate or high growth, second, there will be a shift in China's economic growth model from intensive growth to innovative and consumer-driven growth, and third, precautions against risk should play a more important role, according to Li Huiyong, an analyst at Shenyin Wanguo Securities.
Although in the transition process, China's economic growth will experience a slowdown, the quality and efficiency of the economy will be greatly improved, with a transition from the "world factory" to the "world market" - from "Made in China" to "Created in China". China's contribution to the world economy will continue to grow.
During the transition process the technology, capital, and experience of developed countries can be introduced to the Chinese market and they can play a positive role in China, says Xu Hongcai.
In the context of economic globalization, China has always advocated the liberalization of trade and the facilitation of investment, but it has also pursued an upgrade of the industrial structure, energy saving, and improvements to the energy structure, which have positive implications for the world economy and for ecological and environmental protection.
The article is edited and translated from 中国经济降速西方为何起急（热点聚焦), source: People's Daily