Friday, 21 January, 2022

‘Chinese economy could grow at 6pc in 2022’

‘Chinese economy could grow at 6pc in 2022’

BEIJING: China’s economy could grow around 6 percent in 2022, a year in which the economic calendar is set to be punctuated by major events including the Beijing Winter Olympic Games and the 20th Communist Party of China (CPC) National Congress, former vice commerce minister Wei Jianguo said Saturday at the Global Times Annual Forum.

The resilience of the economy, underpinned by its success in containing the pandemic, and a pathway for China to unseat the US in economic terms at a quicker pace despite the shadow of US decoupling efforts, were some of the key takeaways from the forum, report agencies.

The remarks were seen a shot in the arm for the economy, which according to the annual Central Economic Work Conference concluded on Friday, is expected to face major challenges over the next twelve months-shrinking demand, supply crunch and downward pressure on economic prospects.

China’s GDP growth could hit 9-9.5 percent this year before registering 6 percent in 2022, Wei Jianguo, vice chairman of the China Center for International Economic Exchange and former vice minister of the Ministry of Commerce, said during a panel discussion on the economy’s outlook.

Wei cited the Winter Olympic Games and the 20th CPC National Congress as underpinning his optimism on the Chinese economy.

If China’s GDP grows by 5 percent in the fourth quarter, annual growth will be around 8.5 percent, according to Cao Wenlian, the board chairman for the Moganshan Research Institute, at the forum.

Economic growth slowed to 4.9 percent in the third quarter, whereas the GDP growth reading for the first three quarters still held strong at 9.8 percent year-on-year, official data showed.

Although China’s economy faces challenges next year, policy intensity will increase on 2021 levels, with some measures having already been rolled out in advance, Cao said during the same panel discussion.

“China’s policy innovation is a very important driving force in view of its achievements in the past decades, especially when responding to changes across economic cycles,” said Cao. In a recent pro-growth move, the central bank on Monday announced a broad-based 0.5 percentage-point cut in the reserve requirement ratio for financial institutions, effective December 15.

“Next year, there will be more policies to support and protect market players, improve supply chains, and expand domestic demand,” said Cao.

Additionally, macro-management policies will be gradually adjusted to pricing policies, as the market will start playing its role in allocation of commodity procurement, remarked Zhang Jun, dean of the School of Economics at Fudan University.

Other than policy innovation, observers urged efforts to foster the economy’s technological development in the face of intermittent decoupling actions by the US.

“We should be vigilant against underlying tech becoming a bottleneck,” said Du Lan, a senior vice president of Chinese AI giant iFlytek.