Illustration: Chen Xia/Global Times

The Western media has paid close attention to the Chinese economy as it transforms its model of growth. But, while many have been focusing on the supply side, hyping China's meteoric rise in manufacturing and the rising level of exports, less attention has been paid to the demand side.

Apple CEO Tim Cook is on a visit to Shanghai, according to a post on his official Weibo account on Wednesday. Why do foreign CEOs frequently visit China? China's consumption upgrade, paired with a commitment to opening-up, is creating a sizzling market that no foreign company wants to miss. This represents a microcosm of what has happened in the Chinese economy on the demand side.

It comes amid heated discussion about China's development model. Harold Thibault, a journalist for Le Monde, wrote on Monday that China seeks to adopt a new development model for its economy. He described this model as a combination of policies involving stepped-up investment in the energy transformation or artificial intelligence, while stabilizing old growth engines such as real estate or infrastructure, according to media reports.

Thibault believes China's approach, which involves supply-side efforts, may encounter problems. At present, some Western observers claim China's consumer market is not big enough to digest an increase in industrial capacity brought by supply-side reforms, so it has led to overcapacity and a rising tide of exports. Such a misreading reflects Western elites' bias toward the Chinese economy.

China, which has a population of about 1.4 billion, is more complex than some Western elites imaged. China has its own special national conditions and its economic system is well-suited to its economic development. China's development model has not only absorbed Western development experiences, but is also based on its own conditions.

It's fair to say it's a kind of integrated innovation. China has the right to explore and choose its development model. A growth model with Chinese characteristics has been proven effective, and it is beneficial to the world economy.

The misunderstanding is that some Western observers believe China's consumption cannot support its economic transformation. The fact is that China's consumption in 2023 played a vital role in bolstering economic development. 

Official data showed final consumption contributed 82.5 percent of overall GDP growth. The booming consumption underscored China's steady progress from being an investment-driven economy to one that is consumption-driven.

For example, China's new-energy vehicle (NEV) sector closed 2023 with better-than-expected results. The industry is expected to see continued growth this year. 

In the first two months of 2024, production of NEVs reached 1.252 million, up 28.2 percent, and sales reached 1.207 million, up 29.4 percent, according to the China Association of Automobile Manufacturers (CAAM).

While China's emphasis on constructing a modern industrial system and accelerating the development of new quality productive forces is expected to boost production, the country's consumption upgrade has accelerated. With the ongoing consumption upgrade, Chinese consumers buy more electronic products and daily necessities. The NEV industry is a good example, indicating that China's consumer market and productivity growth are synchronized.

China's exports of NEVs are increasing - that's a fact. But China's NEV market also provides broad opportunities for foreign-funded enterprises. However, whether those companies can seize this opportunity or not will depend on the competitiveness of their products.

China's consumption of industrial intermediate goods is also on the rise. China has become the largest country in intermediate goods trade. In 2023, China's imports of intermediate goods reached 14.29 trillion yuan ($1.98 trillion), accounting for 79.4 percent of the total import value. This includes 4.41 trillion yuan in mechanical and electrical products.

The transformation of China's development model and its efforts to accelerate the development of new quality productive forces and promote high-standard opening-up will offer the world a new opportunity for cooperation. Westerners should take a panoramic view to see the whole picture in an objective and comprehensive manner to seize the opportunities.

The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn