China has maintained steady economic recovery so far this year against the backdrop of multiple global challenges, and growth is likely to have accelerated in the nearly completed second quarter, the country's top regulator for State-owned assets said on Tuesday.
Zhang Yuzhuo, chairman of the State-owned Assets Supervision and Administration Commission of the State Council, said the country has witnessed some positive signs for a strong recovery on both the supply and demand sides.
"People estimate that in the first half of this year, Q2 performance will be better than Q1," Zhang said at a meeting on Tuesday during the 14th Annual Meeting of the New Champions, also known as the Summer Davos Forum. The event, themed "Entrepreneurship: The Driving Force of the Global Economy", runs from Tuesday through Thursday in Tianjin in North China.
While it is generally believed that China's strong economic recovery is helping boost confidence in the global economy, Zhang also warned of challenges relating to fields such as the lower-than-expected growth in foreign trade.
More efforts should be made to create more new growth points for consumption as well as scale up some emerging sectors to generate a more substantial impact, he added.
"It is our hope that through high-level forums, such as the Summer Davos Forum, we can build and maximize our consensus to deepen cooperation … so that we can collectively contribute to a global economic recovery," Zhang said.
His views were echoed by Ngozi Okonjo-Iweala, director-general of the World Trade Organization, who called for more efforts to build global resilience and said that decoupling and fragmentation will be costly for the world.
"If we decouple into two trading blocs, it will cost the world a 5 percent loss in global GDP in the longer term. The IMF estimates (the long-term cost of trade fragmentation could be as high as) 7 percent (of global GDP)," she said at the same forum on Tuesday.
"That's like saying that we lose the equivalent of the whole economy of Japan, which will be catastrophic for the world. So, decoupling and fragmentation are something that the world simply cannot afford to have," she added.
When it comes to headwinds facing the global economy, Okonjo-Iweala said World Bank research shows that the long-term growth potential of both developed and developing countries, as well as emerging market economies, is declining due to some structural factors like demographics, and called for more efforts to harness areas where there is productivity growth and where more youthful labor can help the global economy.
However, she still sees some opportunities in global trade including rapidly growing digitally delivered services and promising growth potential in green trade.
Fitch Ratings recently raised China's 2023 GDP forecast from 5.2 percent to 5.6 percent after a swifter-than-expected reopening rebound in the first quarter.
China's GDP expanded 4.5 percent year-on-year in the first quarter, compared to an estimate of 2.8 percent in a previous report issued by Fitch Ratings in March.
"With consumption recovering and the drag from falling construction activity easing, domestic demand growth will pick up in 2023," said Fitch Ratings.
Looking ahead, Bruce Cameron, chairman of Zespri — a cooperative of kiwi fruit growers in New Zealand — expressed strong confidence in the Chinese economy despite headwinds, and the enterprise will seek to expand to more provinces and cities in China and penetrate deeper into those markets.
"Whilst we see some financial challenges globally, which will no doubt affect all economies … we still see positive growth for our kiwi fruit in China," Cameron told China Daily on Tuesday during the ongoing Summer Davos Forum.
"Given the fact that the underlying performance of the Chinese economy is still expected to grow, we continue to have a very positive outlook in terms of how we see the potential of our market here in China," he added.
