China’s new economic development offers fresh China-EU opportunities

This is a moment of intensifying geopolitical conflicts, rising global protectionism and a sluggish world economic recovery.

Against this backdrop, European friends are paying close attention to China’s economic prospects and the future of China-EU cooperation.

China recently held the Central Economic Work Conference, the country’s most important annual economic meeting. A series of important signals were released from the meeting.

It is important to note that the Chinese economy will achieve new development, which means new opportunities for China-EU cooperation. We have full confidence in this regard.

First, China’s economy has remained generally stable and has progressed steadily this year.

It is true that there are issues of insufficient domestic demand, operational difficulties for some enterprises, certain pressures on employment and income growth, and the deepening adverse impact of changes in the international environment.

However, we are fully confident that the economic growth target we set for 2024 will be achieved.

In the first three quarters of this year, China’s economy grew by 4.8% year-on-year, ranking among the top performers globally. This is no small achievement for a country with a population of over 1.4 billion and a gross domestic product exceeding 126 trillion yuan (€16.7bn).

With the recent introduction of a package of incremental policies to expand domestic demand and boost consumption, market confidence and expectations have significantly improved, and the economy has shown a clear upward trend.

The composite PMI in November reached 50.8%, with the manufacturing PMI rising to 50.3%, an increase of 0.2% from the previous month.

Retail sales of consumer goods in October grew 1.6% faster than in September. Consumer confidence rebounded for the first time after six consecutive months of decline, while the financial and real estate sectors saw growth of 3% or more.

Overall, China is on track to meet major socio-economic goals for 2024, with expected full-year economic growth of around 5%.

More proactive, more effective and more productive

Second, the fundamentals of China’s long-term economic growth remain unchanged.

From the big picture, China’s economy benefits from a stable foundation, a vast market, strong resilience, significant potential, and a complete industrial system.

The Third Plenary Session of the 20th CPC Central Committee set out a systematic plan for further deepening reform and advancing Chinese modernisation.

Over 300 key reform measures are to be implemented within five years, which will give full play to China’s economic strengths and inject strong momentum into its development.

From the perspective of macroeconomic policy, China will implement more proactive fiscal policies and moderately accommodative monetary policies.

By enhancing the policy toolbox and using a combination of measures, China will make macroeconomic regulation more forward-looking, targeted and effective to improve the overall policy efficiency.

From the perspective of industry and technology, China is accelerating the development of new productive forces, with new technologies, industries, business formats and models emerging continuously.

In the first three quarters, the value-added output of large industrial enterprises increased by 5.8% year-on-year, with high-tech manufacturing growing by 9.1% and information transmission, software and information technology services by 11.3%.

Breakthroughs were achieved in areas such as manned spaceflight, quantum information, nuclear power technology and large aircraft manufacturing. Underpinned by reasonable growth in quantity, China’s economy is improving in both structure and quality, and internal forces are driving development.

Notably, China’s economic growth is increasingly greener, with non-fossil energy consumption in total energy consumption increasing by 2.6 percentage points year-on-year.

Opportunities to develop and expand together

Third, China is ready to share development opportunities with Europe and the wider world. We believe that a better China means a better world, and a better world means a better China.

Over the years, China has consistently contributed around 30% to global economic growth.

This year, China lifted all restrictions on foreign investment in the manufacturing sector, introduced the first nationwide negative list for cross-border trade in services, and steadily expanded access in sectors such as telecommunications, internet, education, culture and healthcare.

To further facilitate cross-border travel, China has implemented or optimised the unilateral visa-free policy for 38 countries, including 24 EU member states.

Going forward, China will continue to expand high-level opening up, align with international high-standard trade rules, introduce more voluntary and unilateral opening-up policies, and expand a globally oriented network of high-standard free trade zones.

The efforts to promote institutional opening up and create a world-class business environment that is market-oriented and law-based will provide new opportunities for other countries to profit from China’s development. China will remain a key driver of global economic growth.

Partners, not rivals

The world has entered a period of turbulence and transformation. China and the EU, as two major forces driving multipolarity, two large markets supporting globalisation, and two great civilisations advocating diversity, have no fundamental conflicts of interest.

There is far more consensus than divergence and far more cooperation than competition. This makes us partners, not rivals.

The essence of China-EU practical cooperation in trade and other areas is complementary advantages and mutual benefit.

It is hoped that the two sides can properly handle economic and trade frictions through dialogue and consultation to avoid a trade war. This is in the interests of both sides and the world.

Next year, we will celebrate the 50th anniversary of China-EU diplomatic relations. As a Chinese saying goes, “Blossoms in spring turn into fruits in autumn, and a bumper harvest is the reward of hard work.”

At this new starting point, China is ready to work with the EU to seize opportunities and meet challenges to pave the way for the next 50 years of China-EU relations and contribute our share to global peace, stability and prosperity.

Ambassador Cai Run is Head of the Chinese Mission to the European Union.