Residents go shopping at a shopping mall in Nanjing, East China's Jiangsu Province, on December 11, 2022. Consumption gradually resumed after the release of optimized COVID-19 response measures. Photo: VCG

China' top economic planner on Friday said that the recent domestic epidemic has had a certain impact on stable economic recovery in November, but the Chinese economy has withstood the impact of shocks that exceeded expectations, showing strong resilience and potential. China's economic growth is expected to continue to pick up with the implementation of the optimized anti-COVID measures.

Speaking of the impact of the current epidemic situation on China's economic development, a spokesperson of the National Development and Reform Commission (NDRC) said on Friday that the development of consumption and the service sector has been constrained, imports and exports have fallen, and expectations of manufacturing enterprises have been weakened somewhat according to information available so far.

Facing new challenges, the NDRC said it will step up efforts to implement a package of policies and follow-up measures to stabilize the economy, and has made solid progress in implementing policy-oriented financial instruments, issuing special loans for upgrading equipment and subsidized government interest, and expanding medium and long-term loans to the manufacturing sector.

On the whole, the Chinese economy has withstood the impact of shocks that exceeded expectations, showing strong resilience and potential. The quality of development has steadily improved, employment and prices have been basically stable, and the trend of economic recovery has not changed, said the spokesperson.

With the continued implementation of optimized measures for epidemic prevention and control and the gradual release of the effects of various policies to stabilize the economy, China's economic growth is expected to continue to pick up, said the top economic planner.

According to NDRC, increasing household incomes will be one of its priorities, adding that it will strive to increase the size of the middle-income group.

Such efforts are in parallel with encouraging new forms of consumption. Going forward, the NDRC will work with relevant parties to improve the quality of consumption by further promoting traditional consumption, expanding service consumption, new consumption, green consumption and rural consumption.

The NDRC on Thursday released an action plan to boost domestic demand.

Increasing income and boosting consumption are seen as follow-up measures to the guideline revealed on Wednesday, aimed at further expanding domestic demand with the goal of raising the scale of consumption and investment to a new level by 2035.

In the past two years, the share of household consumption in overall economic contribution has actually been on the rise, Tian Yun, a Beijing-based economist, told the Global Times.

"As long as the epidemic is under control and we adopt appropriate policies, a growth in domestic consumption of about 5-6 percent in 2023 should be achievable," said Tian.

He noted that China still has a lot of room to expand domestic demand, and a lot of service consumption needs to be opened up. Tian added that consumption in areas such as medical care, education, culture and sports still has a lot of room for growth, and believes there will be corresponding policies in the future.

Meanwhile, the NDRC will encourage more foreign investment in advanced manufacturing, modern service industries, new and high technologies, energy conservation, and environmental protection. Foreign investments are also welcomed in the Central, western and northeastern regions in China.

According to the NDRC spokesperson, the commission will implement the plans set out in the 14th Five-Year Plan (2021-25) for further opening up telecommunications, as well as the education, culture, medical care and other sectors in an orderly manner. The NDRC will appropriately reduce the negative list for foreign investment access, and continue to conduct pilot free trade zones and other trials.

About 77 percent of German companies surveyed believe that their profits in China will continue to grow in the next five years, said Wang Wenbin, a spokesperson of the Chinese Ministry of Foreign Affairs, on Friday during a press conference, citing a report by the German Chamber of Commerce.

In another report, 66 percent of the surveyed Australian companies plan to increase investment in China, and 58 percent regard China as one of the top three investment destinations in the world in the next three years.

"This once again proves the confidence of the international community in the prospects of China's economic development," said Wang.

Global Times