China's Economic Resilience

来源: CHINA FOREX 2017 Issue 1 作者:Mu Zhiqian

The U.S economy is in recovery,while the Chinese economy is making a tentative recovery. Economists often describe China as undergoing a U-shaped or even a V-shaped recovery but this doesn't quite tell the whole story. To complete the picture,we need to take into account the economy's uncanny resilience.

China's population is more than twice the size of the U.S,Japan,Germany,France and Britain combined. So it has a huge pool of consumers and the consumption capacity has expanded rapidly in recent years. In fact,consumption is one of the areas where China's economic resilience has been most evident. As the nation's heavy industry fell upon hard times,it was the consumer who helped keep growth on track.

And behind this consumption power we can see the government's effort to promote ever greater urbanization in a country that once was largely rural. China went from a 20% urban population to 40% in 22 years -- a trajectory that took Britain 120 years,France 100 years,Germany 80 years and the U.S 40 years. The rate of urbanization in these developed economies has now topped 80%,however,and China needs to accelerate this process in the year's ahead. Urbanization and industrialization go hand in hand. This will be the basis of maintaining a medium to high speed of economic growth - or the rate of 6% to 7% which government planners hope to achieve.

The push for greater urbanization has meant a dramatic rise in living standards. Chinese tourists have become much sought-after customers who are known for their strong purchasing power.

As for the nation's industry,restructuring is the key to future development. The first areas to develop were along the nation's southeastern coast,but now many of the early industrial leaders are in need of upgrading and retooling. As an old saying goes,"when it is dark in the east,it is bright in the west." As China undergoes restructuring in the east,the central and western areas can pick up the slack.

The economy is also finding new sources of potential. China is displaying its capacity for innovation. It is at the cutting edge of Internet applications and making gains in some of the newer technologies such as drones,high-speed trains and biotechnology.

Meanwhile,the Chinese government is also displaying its own resilience,demonstrating its ability to mobilize its population. Despite considerable pressure from abroad,the government has made its objectives clear and there is broad public acceptance of the nation's common goals.

China's economic resilience is undeniable. Investors worldwide can truly be confident in the nation's ability to achieve its potential.