Belt and Road lead the way to rising trade and investment
The Government Work Report delivered by Premier Li Keqiang on Monday reflected both the rosy and not-so-rosy sides of China's economic and social development.
On the rosy side, China's GDP has risen from 54 trillion yuan ($8.52 trillion) to 82.7 trillion yuan over the past five years, with its share in the global economy growing to roughly 15 percent and its contribution to global growth exceeding 30 percent.
China's economic activities with other economies last year showed the country's growing capacity to help rebalance the world economy and determination to realize win-win global cooperation. That contention is supported by China's overall trade and investment flow vis-a-vis the rest of the world and by the figures related to its economic relations with the economies that are involved in the China-proposed Belt and Road Initiative.
Li said in the report: "We are committed to achieving shared growth through discussion and collaboration, and will act on the outcomes of the Belt and Road Forum for International Cooperation. We will work toward building major international corridors and deepen cooperation on streamlining customs clearance along the routes of the Belt and Road Initiative."
Trade continues to be the driving force of China's growing economy, which grew 6.9 percent last year. However, the growth momentum of imports is much stronger than that of exports, which should be welcomed by most of China's trading partners, especially the Western economies, because many of them are still facing the problem of high, even rising unemployment. The breakdown of foreign trade shows the growth rate of China's imports was much higher than the growth rate of exports with all its major trading partners, including the European Union, the country's biggest trading partner, the United States, ASEAN states and Japan.
Compared with 2016, China's imports from its four leading trading partners have all increased by more than 15 percent. This, together with the fact that China has contributed to more than 30 percent of the world's economic growth for years, must have helped create more jobs in those economies.
There is little doubt that China's imports will continue to increase. China now boasts a middle-income population of about 400 million, roughly the combined total of the US and Japan, and their purchasing power is steadily expanding. The demands of the Chinese middle-income group extend from consumer goods to education, cultural products and tourism, which will bring China and its trading partners even closer.
The increasing demands of China's middle-income group means the country's imports and outbound tourists will continue to rise, and the gap between the country's exports and imports will decrease, though China will still be a trade-surplus country for some years.
For decades, China's exports-led economic policy has provided the world with affordable goods. But this economic pattern is about to change thanks to China's current policy of modernizing its manufacturing sector and moving up to global production chain. For example, to encourage imports, China has decided to host the first China International Import Expo in Shanghai from Nov 5 to 10 this year. Such bold actions will help further rebalance the global economy and create more jobs in other economies.
China's trade with those economies involved in the Belt and Road Initiative, too, was impressive last year. With the overall growth rate being as high as 17.8 percent, China's imports from those economies increased 26.8 percent year-on-year, much higher than in the previous year.
Besides, China's inbound foreign direct investment soared 27.8 percent in 2017, which saw 35,652 foreign enterprises start new businesses in China, whereas its overseas investment saw a sharp decrease－of 29.4 percent－mainly due to rising protectionism and isolationism in some economies.
But two-way investments between China and the economies involved in the Belt and Road Initiative have been brisk, and 3,857 newly established enterprises in China are from those economies, up by 32.8 percent. And despite the decrease in China's overseas investment, Chinese businesses directly invested $14.4 billion in economies taking part in the Belt and Road Initiative in 2017, roughly the same level as that in the previous year.
This is just the beginning, and in the long run, the flow of two-way trade and investment between China and the economies taking part in the Belt and Road Initiative will increase at an even faster pace.
The author is deputy chief of China Daily European Bureau.