China Remains the Driving Force Behind Global Economic Recovery

(Reported by Yang Xiaolin, Economic Daily)

In 2023, the global COVID-19 pandemic experienced a successful turning point, but the global economy has not yet escaped the torment of the pandemic's "aftermath." Looking ahead to 2024, what opportunities and challenges will global development face? On December 29, the 170th session of the "Monthly Economic Talk" organized by the China Center for International Economic Exchanges (CCIEE) took place, reviewing the world economy since the COVID-19 pandemic, with the aim of providing a clear understanding and offering recommendations for global development in the coming year.

Recently, several international institutions have successively released macroeconomic outlook reports for 2024, with "global economic development will slow down" emerging as a major consensus. In response to this, Zhu Guangyao, Vice Chairman of the CCIEE and former Vice Minister of Finance, stated that the global multilateral cooperation mechanism has not fully recovered from the impact of the pandemic. In particular, the unilateral actions of the United States have made it difficult for the global economy to enter a fast-paced trajectory of comprehensive recovery in the post-pandemic era.

Wang Yiming, Vice Chairman of CCIEE and Chairman of the Academic Committee in CCIEE, stated that looking back at the first decade of this century, rapid global economic growth, continuous improvement of the supply chain system, and the acceleration of globalization are inseparable. Currently, globalization is facing headwinds, with increasing trade protectionism and unilateralism, as Western countries, including the United States, promote the so-called "decoupling" operations. This will intensify the fragmentation of the global economy, leading to a slow and uneven global economic recovery, with further increased uncertainty.

“China and the United States should fully implement the consensus reached at the San Francisco Summit. This is of great significance for repairing the multilateral mechanism and promoting global economic and trade recovery," said Zhu Guangyao. He expressed that currently, artificial intelligence is flourishing and exerts significant driving force on the Fourth Industrial Revolution, becoming a major trend in the future development of the global economy. The international community urgently needs to reach a consensus agreement on relevant policy frameworks and governance arrangements. However, some U.S. politicians are extremely shortsighted on this issue, actively suppressing China in areas such as chips and artificial intelligence, hindering global cooperation in this field.

Chen Wenling, Chief Economist and Deputy CEO of CCIEE, focused on analyzing the new risks that the adjustment of the United States' monetary policy may bring to the global economy in 2024. She stated that the "historic" tightening cycle of U.S. monetary policy may be coming to an end, and the timing of the new year's shift to loose monetary policy and whether it will once again lead to liquidity flooding are issues that the entire world needs to be vigilant about.

Chen Wenling also mentioned that the U.S. debt crisis and financial risks have led more and more countries to question the credibility of the U.S. dollar. Currently, the total amount of U.S. national debt has exceeded $33 trillion. According to the Congressional Budget Office's budget outlook, over the next 30 years, the scale of U.S. national debt will nearly double. "De-dollarization" may become a major development trend in the future, leading to a significant transformation in the world monetary system.

Recently, many international organizations and business institutions have successively raised their growth expectations, giving a vote of confidence to the Chinese economy. The International Monetary Fund (IMF) has increased its forecast for China's economic growth in 2023 from 5% to 5.4% and raised the prediction for 2024 by 0.4 percentage points to 4.6%.

Zhu Guangyao stated that the positive momentum of China's economic recovery has exceeded previous expectations of the international community. The upward adjustments by these international institutions are based on solid facts. In the first three quarters of this year, the effective combination of China's macroeconomic policies has continuously shown results, leading to a sustained improvement in the economic recovery, with the GDP growth rate reaching 5.2%. As we enter the fourth quarter, China's macroeconomic situation continues to follow a positive trajectory of recovery. The widespread upward adjustments in expectations by international institutions indicate that the international community still views China as the largest engine for global economic growth.

Zhang Yongjun, Deputy Chief Economist of CCIEE, stated that since the outbreak of the pandemic, the overall trend of China's economic development has been relatively favorable. Currently, the favorable conditions facing China's development remain stronger than unfavorable factors, and the fundamental trend of economic recovery and long-term improvement has not changed. The issues and challenges we face are part of the ongoing progress and development. The prospects for China's economic development remain very bright and will continue to provide ample confidence and support for the ongoing global economic recovery.