China's growth outlook draws global confidence

Global executives and leading economists voiced confidence in China's economic resilience and long-term prospects on Tuesday, citing strong momentum in high-tech sectors, continuing economic rebalancing and strong policy support, as the country's stable growth outlook drew renewed attention amid rising external uncertainties.

They made the remarks at the ongoing 17th Annual Meeting of the New Champions of the World Economic Forum, also known as the Summer Davos forum, held under the theme "Innovating at Scale" in Dalian, Liaoning province.

Despite external headwinds, they said China's vast and dynamic market, along with vibrant technological and industrial innovation, is creating fresh opportunities for global businesses and injecting new momentum into global growth.

Yin Zheng, executive vice-president of China and East Asia operations at French industrial conglomerate Schneider Electric, said that advanced technologies, including artificial intelligence, are accelerating the world's transition toward a more digitalized and intelligent era.

"China, as a major engine of global growth and an important technology hub, is becoming a fertile ground for global innovations," Yin said, adding that the country is further strengthening its advantages across industrial and innovation systems.

Jiang Ying, chair of Deloitte China, said China's complete industrial system, resilient economic fundamentals and continued high-level opening-up remain key pillars underpinning the country's long-term growth.

She said that emerging sectors such as AI and the low-altitude economy are poised for further breakthroughs, while the coordinated development of traditional and new growth drivers will help sustain China's economic momentum.

Echoing that view, Ruan Fang, managing director and senior partner at Boston Consulting Group, said that China's most notable growth opportunities lie in advanced manufacturing and AI.

The world's second-largest economy has become a major innovation hub, supported by its huge market, intense competition and fast pace of iteration, she said.

"Many multinational companies choose to stay in China not only for revenue or profits, but also to tap into such innovation — whether in business models, products or AI applications," Ruan added.

Offering a macroeconomic perspective, Huang Yiping, dean of Peking University's National School of Development, struck a similarly optimistic note, saying that despite the challenges facing the Chinese economy, the country has been steadily advancing economic rebalancing, with positive progress already taking shape.

"If you look at the trajectory of the Chinese economy over the past 20 years or more, the macroeconomic structure is much better now," Huang said at a forum during the event.

However, he warned that the rebalancing process remains far from sufficient. "China needs to boost consumption, and it needs to do so in a more proactive way," Huang said.

The broader confidence in China's outlook came as global financial markets faced renewed uncertainty, with expectations of possible interest rate hikes by the United States Federal Reserve adding to concerns over market volatility and cross-border capital flows.

According to Reuters, BofA Global Research, the research arm of Bank of America, and Deutsche Bank now expect the US Federal Reserve to raise interest rates in 2026, marking a departure from prior forecasts of steady rates.

BofA said on Monday that it expects the US central bank to raise rates by 25 basis points each in September, October and December, while Deutsche Bank, in a note dated June 19, forecast two 25-basis-point hikes this year — one in September and another in December.

Shi Kang, chair professor at Tsinghua University's PBC School of Finance, said at an earlier forum in Beijing that if expectations of further US rate hikes become increasingly entrenched, US capital markets may face a significant adjustment, which could send shocks across the global economy.

"At such a time, a stable renminbi could provide valuable support for global liquidity," Shi said.

He said that amid inflationary pressure, the US has limited policy room to absorb such shocks, given its high debt levels and already elevated interest rates, adding that global markets need more sources of financial stability.

Yang Chang, an analyst at Zhongtai Securities, said that China's monetary policy has long adhered to the principle of being mainly guided by domestic conditions, and the People's Bank of China, the country's central bank, still has room to maintain reasonably ample liquidity through targeted and flexible policy operations.

Contact the writers at zhangchenxu@chinadaily.com.cn