China is actively taking measures to stabilize its real estate market, the National Financial Regulatory Administration (NFRA) said on Wednesday, as it emphasized the need to promote a virtuous cycle between the financial sector and the housing market.
With nationwide property industry meetings, China is pushing to promote the country's challenged housing market.
During the NFRA's meeting on Wednesday, the administration stressed the need to implement city-level real estate financing coordination mechanisms and enhance the efficiency of the new white list mechanism, to meet the financing needs of real estate enterprises.
It is part of the administration's latest effort to support the housing market. Li Yunze, head of the NFRA, told reporters on Monday that the administration will continue to aid the economy's recovery and improvement, which will include reducing the interest rates on existing first-home loans to reduce buyers' interest expenses.
In another move, the Shanghai Real Estate Trade Association held a meeting attended by major property developers.
The meeting, held on March 7, saw participation by 11 companies, including China Poly Group, China Resources, China Railway Construction Corp and Shanghai Baohua Group. According to the association's WeChat account, attending companies reached a consensus that Shanghai's real estate market is still undergoing adjustments and participants called for more policy adjustments.
The real estate market often sees a surge in March and April. However, such trends are not evident this year, indicating ongoing adjustments in the market, Hui Jianqiang, a veteran industry analyst, told the Global Times on Wednesday.
Despite an increase in inquiries after the Spring Festival holidays, Shanghai's real estate companies reported low transactions.
Companies have put forth several policy suggestions, calling for improvements in purchase restrictions, land auctions and refining the supervision of pre-sale funds.
In a bid to revitalize the real estate sector, discussions similar to those in Shanghai have taken place across various regions, including Heze in East China's Shandong Province, Hefei in East China's Anhui Province and Wuhan in Central China's Hubei Province.
Recent measures in first-tier cities - Beijing, Shanghai, Guangzhou and Shenzhen - have relaxed purchase restrictions, but these are seen more as a loosening of earlier constraints rather than incentives to boost the market, resulting in limited effects, Hui explained.
Despite downward pressure, there are signs of stabilization in China's real estate market. Data from the National Bureau of Statistics showed a 0.3 percent month-on-month decrease in new home prices in first-tier cities in January, narrowing 0.1 percentage point from December.
The future of real estate sales in first-tier cities heavily relies on policy easing to stimulate the market, Hui stated. He believes that further relaxation of policies could attract external capital to Shanghai's real estate market, potentially outperforming last year's performance.
Local homebuyers in Shanghai are adopting a wait-and-see approach, a resident surnamed Zhang told the Global Times that the market has stabilized but there's no sign of a rapid upturn anytime soon.
Prices for secondhand homes have returned to levels seen in 2019 and 2020, while new home prices are influenced by purchase policies.
"My colleagues from outside Shanghai who have yet to buy a home remain on the sidelines… and do not feel rushed to make a purchase," Zhang added.
Since 2012, China has witnessed an extraordinary economic transition, with historic achievements in all aspects of the economy from its size to quality. Such an unparalleled feat does not just happen, especially during a tumultuous period in the global geo-economic landscape and a tough phase in China's economic transformation and upgrading process. It was Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era that guided the country in overcoming various risks and challenges, and in keeping the China economic miracle alive.
As China embarked on the quest to become a great modern socialist country amid global changes unseen in a century, Xi's economic thought has been and will continue to be the guiding principle for development in China for years to come, and have great significance for the world. What is Xi's economic thought? What does it mean for China and the world?
To answer these questions, the Global Times has launched this special coverage on Xi's major economic speeches and policies, and how they are put into practice to boost development in China and around the world. This year's two sessions - China's annual legislative and political consultative sessions - officially concluded on Monday, after national lawmakers and political advisers spent a week or so, on mapping the country's social and economic development blueprint for 2024 and beyond.
Often described as one of the most important political events, the two sessions, during which a slew of development goals are determined, offer a critical window for the world to view the latest economic trends and policy priorities in the world's second-largest economy.
More importantly, Chinese President Xi Jinping's agenda and major speeches during the two sessions provide the most crucial insights into the development path of the Chinese economy.
During this year's two sessions, Xi participated in three deliberations or group discussions with national lawmakers and political advisers, during which he also delivered important speeches. And a key theme emerged from these meetings and speeches: The Chinese top leader has put new quality productive forces front and center in China's economic agenda in 2024 and for many years to come.
As a relatively new concept that was first put forward by Xi during an inspection tour of Northeast China's Heilongjiang Province in September 2023, new quality productive forces has become a key phrase in China's political lexicon in recent months. Xi's emphasis on the phrase further highlighted its significance in China's economic policymaking and China's future development paths, as officials across the country have and will continue to roll out measures to boost innovation and generate new productive forces.
China's pursuit of new quality productive forces, which place the main focus on innovation and technological self-reliance, comes as China's economy faces a profound transformation from old growth drivers to sustainable ones, and as the global geo-economic situation has grown increasingly complex - characterized by the US' relentless technological crackdowns and growing protectionism. Therefore, developing new quality productive forces is critical for China's sustainable, high-quality development, Chinese lawmakers, political advisers, and economists said.
Top leader's focus at two sessions
During each year's two sessions, Xi often visits and holds meetings with national lawmakers and political advisors, and delivers major speeches on key national issues. This year, the Chinese president made three such visits, in line with the number made during the two sessions in 2023.
On the afternoon of March 5, Xi participated in a deliberation with fellow lawmakers from East China's Jiangsu Province during the second session of the 14th National People's Congress (NPC), China's national legislature.
Xi called for focusing on high-quality development as a top priority, urging efforts to step up innovation, foster emerging industries, adopt forward-thinking plans to develop future-oriented industries, and improve the modernized industrial system. He stressed the development of new quality productive forces according to local conditions, according to the Xinhua News Agency.
The top leader also made remarks about developing new quality productive forces or related issues such as technological innovation at the other two such deliberations he participated in.
On March 6, Xi participated in a joint group meeting during the second session of the 14th National Committee of the Chinese People's Political Consultative Conference (CPPCC), the top political advisory body. Xi called on political advisors and all people in the science and technology sector to strengthen basic research and apply basic research, strive to achieve breakthroughs in core technologies in key fields, and create new drivers to develop new quality productive forces.
Then on March 7, Xi attended a plenary meeting of the delegation of the People's Liberation Army and the People's Armed Police Force at the second session of the NPC. He stressed deepening reform to comprehensively enhance strategic capabilities in emerging areas. He also said that China's drive to accelerate the development of new quality productive forces has provided rare opportunities for the development of strategic capabilities in emerging areas.
The successive remarks about the new quality productive forces on three different occasions accentuated the top leader's focus on the issue and its importance in China's economic development, not just this year but in the years to come, national lawmakers, political advisers, and experts said. "The concept offers guidance for our country to take advantage of the historical opportunity of a new round of technological upgrade and aims to develop strategic emerging industries and future industries," Guo said.
Developing new quality productive forces is a decisive step in the economy's high-quality development course, Guo Guoping, an NPC deputy and a vice director of the Key Laboratory of Quantum Information of the Chinese Academy of Sciences, told the Global Times.
New quality productive forces refers to innovation-led, advanced productivity that is freed from traditional economic growth mode and productivity development paths, is high-tech, high efficiency and high quality, and is in line with the new development philosophy, Xi said during a group study session of the Political Bureau of the Communist Party of China (CPC) Central Committee in February, stressing that developing new quality productive forces is an endogenous requirement and a pivot of high-quality development. From concept to action
Thanks to the top leader's focus, while the concept of new quality productive forces has only been around for a few months, it has been rising rapidly in China's political and social lexicon and has become a buzzword across the country. More importantly, it has already been put into action in China's economic policymaking.
The Central Economic Work Conference in December 2023, which set top economic policy priorities for 2024, also heightened the development of new quality productive forces. New quality productive forces also became the subject of the first group study session held by the Political Bureau of the CPC Central Committee this year, according to Xinhua.
This year's Government Work Report also highlighted efforts to develop new quality productive forces. According to the report, China will strive to modernize its industrial system and develop new quality productive forces at a faster pace. It also said that China will step up research on disruptive and frontier technologies, and will launch an AI Plus initiative.
The top leader's emphasis on new quality productive forces was echoed throughout the two sessions, where lawmakers and political advisers enthusiastically talked about the concept and vowed to make great efforts in developing new quality development.
Shan Zenghai, an NPC deputy and chief engineer of Chinese construction equipment giant Xuzhou Construction Machinery Group (XCMG), who participated in the deliberation of the Jiangsu delegation on March 5, said he was inspired by the top leader's remarks on new quality productive forces.
"The encouragement from top leadership greatly boosted our confidence in sticking to innovation-driven growth, bolstering the real economy and promoting high-quality development," Shan told the Global Times.
Zhou Bin, another NPC deputy from Yancheng, Jiangsu, who also attended the deliberation, told the Global Times that Xi's important remarks on new quality productive forces have offered scientific guidance for opening up new development tracks and shaping new development momentum.
Many officials vowed to take concrete actions to develop new quality development forces. Wu Qingwen, an NPC deputy and mayor of Suzhou, Jiangsu, said the city has the foundation, the condition, and the responsibility to take a lead in developing new quality productive forces, vowing to step up scientific and technological (sci-tech) innovation and bolster the city's high-end equipment, biomedicine, new energy industries among others, and create "new engines" such as artificial intelligence (AI).
Solid progress, great potential
When it comes to sci-tech innovation and the development of new growth drivers, China has already made great strides, thanks to the focus and support from the top leadership, national lawmakers, political advisers, and experts said.
Despite various challenges, including the US' relentless crackdown campaign, China has already become an innovation power. According to the World Intellectual Property Organization (WIPO) on Thursday, China remained the leader in international patent applications, followed by the US, Japan, South Korea, and Germany.
At the end of 2023, the number of high-value invention patents held on the Chinese mainland had exceeded 1.66 million, an increase of 25.7 percent year-on-year, and the number of effective high-value invention patents acquired in strategic emerging industries had reached 1.17 million, accounting for 70 percent of the total, according to Xinhua.
Also highlighting the steady progress in and importance of forming new growth drivers is the fact that the shift in China's three most popular exports. In the past, the three most popular items China exported were clothes, furniture, and home alliances, which were relatively low-value and labor-intensive; however, new-energy vehicles, solar batteries, and lithium-ion batteries have become China's tech-intensive and green "new three," with a combined export value of 1.06 trillion yuan ($150 billion) in 2023, jumping 29.9 percent year-on-year.
Moving forward, the development of new quality productive forces has great potential in China, as its huge marketplace ensures full testing, application, and evolution of new technologies and new business models, Xu Jiuping, a professor at Sichuan University and a member of the National Committee of the 14th CPPCC, told the Global Times, pointing to the support of national innovation policies.
Underscoring such policy support, the central government has pledged to allocate 370.8 billion yuan ($51.51 billion) for science and technology in 2024, an increase of 10 percent, with a focus on basic research, applied basic research, and national strategic tasks in science and technology, according to the budget adopted at the two sessions.
Liu Donghao, the founder of Guizhou Big Data Protection Engineering Security Research Center, died on March 5, the company confirmed through their WeChat account on Saturday.
Liu also served as the secretary-general of the board and the CEO of Big Data Protection Engineering Security Research Center (Guizhou) Co.
The center was established in November 2017, and was a collaborative project initiated by the Guiyang city government and Alibaba Group, focusing on advanced research and development in data security, aiming to pioneer new governance models and industrial practices.
Since 2017, Guizhou has been actively exploring and practicing data security measures. The establishment of the center was a significant step in this endeavor.
Against the backdrop, the center was tasked with conducting Data Security Capability Maturity Model (DSMM) pilot compliance assessments and fostering the data security industry, in line with Guizhou Province's adoption of the national standard cooperation model for DSMM, CRI Online reported in May of 2023.
The center led by Liu, has developed a comprehensive system called DSMM for assessing data security capabilities across industries, which can identify weaknesses and offer strategic solutions through consultation, certification, and training. By focusing on prevention and addressing existing issues, it aims to enhance overall industry security and risk management.
In 2021, the center introduced a pioneering data security governance framework and industry development system based on DSMM principles, national standards, regulations, and assessment methods. This initiative, centered the DSMM national standard, shapes data security governance practices in Guizhou.
Liu stated that the "Guizhou practice" has now been widely implemented across China, setting a model for cities and provinces such as Sichuan, Tianjin, Jiangsu and Chongqing, spanning industries of telecommunications, taxation, government affairs, and manufacturing. This initiative effectively exports the DSMM national standard, driving the industrialization and scaling of national data security standards.
Guizhou has become one of the regions with the largest number of ultra-large data centers in the world, and the growth rate of digital economy has ranked first in China for several years in a row.
The province's growth rate of digital economy has ranked first among Chinese provinces for seven consecutive years, with its added value accounting for about 37 percent of last year's GDP, according to Guizhou Daily.
The provincial government vowed to focus on AI to develop new quality productive forces, aiming to build an internationally competitive computing base in 2024, Jing Yaping, director of the Guizhou Big Data Development Administration said during this year`s National People's Congress, according to chinanews.com.cn.
China's merchandise trade in the first two months of 2024 hit a record high of 6.61 trillion yuan ($918.3 billion), up 8.7 percent year-on-year, the General Administration of Customs (GAC) announced on Thursday, beating forecasts and signaling a good start to the new year.
Experts said that exports had gained growth momentum, thanks to expanding demand and rising product competitiveness. In the longer term, China's foreign trade will show stable and positive expansion, supporting the GDP growth target of about 5 percent.
Exports in the first two months rose 10.3 percent to 3.75 trillion yuan, and imports were up 6.7 percent to 2.86 trillion yuan.
"Foreign trade saw a better-than-expected performance in the January-February period, mirroring the resilience of the country's economy with expanding domestic and external demand," Tian Yun, an economist based in Beijing, told the Global Times on Thursday.
ASEAN remained China's largest trading partner, with bilateral trade totaling 993.24 billion yuan, up 8.1 percent year-on-year and accounting for 15 percent of China's total trade.
The EU was China's second-largest trading partner, with bilateral trade of 832.39 billion yuan, down by 1.3 percent. The US was No.3, with trade up 3.7 percent to 707.7 billion yuan.
In the first two months, trade with Belt and Road Initiative partner countries reached 3.13 trillion yuan, up 9 percent.
Zhou Maohua, an economist from China Everbright Bank, said on Thursday that the record trade figures reflected the recovery of overseas demand, the optimization of the export structure and a boom in new export drivers.
Electromechanical products accounted for nearly 60 percent of Chinese exports, with automatic data processing equipment, integrated circuits and automobiles showing significant growth, the GAC said.
Exports of automatic data processing equipment reached 195.45 billion yuan, up 7.3 percent, while exports of integrated circuits soared 28.6 percent and those of vehicles increased 15.8 percent.
"The figures mirrored China's continuous industrial upgrading and showed that the competitiveness of its high-tech products and equipment manufacturing industry in the world was increasing," Tian noted.
Conditions were also favorable for trade by private enterprises. Their total trade stood at 3.61 trillion yuan, up 17.7 percent, accounting for 54.6 percent of the total - an increase of 4.2 percentage points from the same period last year.
"Growth in exports led to an increase in domestic production, while the increase in imports reflected strong domestic demand, both of which will help drive the country's GDP growth in the first quarter this year," Wang Peng, an associate research fellow at the Beijing Academy of Social Sciences, told the Global Times on Thursday.
The Government Work Report, delivered by Chinese Premier Li Qiang on Tuesday at the opening meeting of the second session of the 14th National People's Congress, set a GDP growth target of about 5 percent for 2024.
The government vowed to work to steadily increase the volume and raise the quality of foreign trade, with efforts including supporting businesses in diversifying their overseas markets and increasing new growth drivers for foreign trade, including trade in intermediate goods and green trade.
Tian noted that boosted by support policies, foreign trade will maintain moderately positive growth throughout the whole year with an expansion of 3-5 percent.
"China's foreign trade is expected to hit a record high this year, contributing more to the realization of the country's GDP growth target," Tian said.
China on Tuesday set a growth target of around 5 percent for its economy in 2024, a "forward-looking and pragmatic" goal which deputies and economists said sends strong signals that the world's second-largest economy will sustain its firm recovery momentum this year despite rising headwinds, while putting more emphasis on ensuring economic stability and transforming growth models.
Although achieving the growth target will not be an easy task given the sheer size of the Chinese economy and a grim global environment, Chinese officials have voiced strong confidence that the economy will likely meet or even hit over the target, underpinned by the country's indigenous economic vigor as well as Chinese top policymakers' strategic focus and rich toolbox at hands.
The highly anticipated economic agenda also offers a timely rebuttal to Western doomsayers who have recently been sparing no efforts to disparage the Chinese economy. A 5-percent GDP expansion this year would make China still one of the fastest-growing major economies, raising global expectation that the country would continue serving as both a stabilizer and a locomotive for the world.
Strong confidence
The around 5-percent GDP target, along with a series of other key economic goals, was released in the Government Work Report delivered by Premier Li Qiang on Tuesday to the second session of the 14th National People's Congress (NPC).
The GDP goal is similar to last year's and is in line with market expectation, which observers said mirrors the country's work priority to maintain policy consistence and economic stability.
In setting the growth rate, Chinese policymakers have taken into account the need to boost employment and income, and prevent and defuse risks. This growth rate is well aligned with the objectives of the 14th Five-Year Plan (2021-25) and the goal of basically realizing modernization. It also takes account of the potential for growth and the conditions supporting growth and reflects the requirement to pursue progress and strive to deliver, according to Government Work Report.
While acknowledging that achieving this year's targets will not be easy, Li pledged that the country will "maintain policy focus, work harder, and mobilize the concerted efforts of all sides."
"The GDP goal is very forward-looking and inspiring. In the Government Work Report, Chinese policymakers do not refrain from walking through this year's challenges and downward pressures, and they showed strong confidence and capacity to tackling with them head on," Pan Biling, a member of the National Committee of the Chinese People's Political Consultative Conference (CPPCC) and the president of Xiangtan University, told the Global Times on Tuesday.
Tian Yun, a veteran economist based in Beijing, told the Global Times on Tuesday that the target also underscores Chinese authorities' "bottom-line" thinking strategy, based on a sober assessment of a worst-case scenario.
"Without a certain modest level of GDP expansion, it would be very difficult to shore up the real economy, maintain the sound development of capital market, and lift up social expectation," he explained. "And an abrupt slowdown could fuel social uncertainties and financial risks."
Observers said a 5-percent GDP growth aligns with the long-term development goals laid out by the 14th Five-Year Plan (2021-25) and the Long-Range Objectives through 2035, which stated that the country's GDP should double by 2035, compared with its 2020 level. It also provides a necessary condition for China to achieve its goal of "creating over 12 million new urban jobs" in 2024 listed in the Government Work Report.
According to Tian, if the Chinese economy grows by 5 percent or above this year, it will still be one of the fastest among major economies.
A growth rate of around 5 percent would also be faster than IMF's projected global growth rate of 3.1 percent or the forecast of 1.5 percent for advanced economies and 4.1 percent for emerging market and developing economies. The IMF, in its latest World Economic Outlook report released in January, projected that China's GDP will grow by 4.6 percent in 2024
"China's net contribution to the global economy is poised to be larger than previous decades, taking account of the high base," Tian said. Observers estimated that the Chinese economy will contribute around 30 percent to 35 percent to global growth this year.
Han Baojiang, a member of the National Committee of CPPCC and a professor at Party School of the Central Committee of the Communist Party of China, told the Global Times that setting GDP goal is also a "timely, clear" response to certain pessimistic voices on Chinese economy, especially from the international society.
"The positivity released by the economic work is clearly in contrast with Western smears against the Chinese economy. And those doomsayers don't understand the vigor and potential of an economy whose modernization involves 1.4 billion people," Han said.
Transforming growth model
Deputies and political advisors told the Global Times that there is a slew of new policy insights from this year's Government Work Report. "I could see a spirit of reform and innovation in the economic roadmap," Pan said.
According to the report, China will move faster to create a new pattern of development, and promote high-quality development. The report highlighted 10 major tasks this year and "striving to modernize the industrial system and developing new quality productive forces at a faster pace" was listed at the foremost.
"New quality productive forces are a pioneering concept proposed by Chinese top leaders last year. As the Chinese economy is undergoing a period of structure transition, the creation of such drives will play an outsized impact not only in guiding economic progress, but also in shaping the global tech landscape," Han said, while highlighting China's whole-nation systematic advantage in gearing up such new drives.
Chen Fengying, an economist and former director of the Institute of World Economic Studies at the China Institutes of Contemporary International Relations, told the Global Times on Tuesday that drawing upon the wording from the Government Work Report, she expects to see Chinese government's "broader efforts" in innovation, reform and opening-up.
"The international environment remains complex amid a year fraught with presidential elections. Meanwhile, the US has been taking aim at China's tech industry with its so-called 'small yard, high fence' approach. Internally, the Chinese economy also faces an array of hindrances, including weak market confidence and property market downturn that could weigh on the development prospect," Chen said. She noted that it is crucial that China deepens reforms, especially in driving internal demands, to sustain a full-fledged economic recovery.
The Government Work Report also presaged more fiscal stimulus to shore up the economy this year, according to economists.
China's deficit-to-GDP ratio is set at 3 percent this year, and the government deficit is set at 4.06 trillion yuan, an increase of 180 billion yuan over the 2023 budget figure.
"We should appropriately enhance the intensity of our proactive fiscal policy and improve its quality and effectiveness," Li said. He also proposed that 1 trillion yuan ultra-long special treasury bonds will likely be issued in 2024, and such bonds will also be issued over each of the next several years.
"It is a good time to scale up the issuance of special treasury bonds, as the borrowing cost will inch lower in the coming months, and as China's inflation is relatively low," Tian said, adding that China still has sufficient room for more fiscal and monetary policy maneuver this year.
Observers said if the potential of all available resources and other elements are fully utilized, China could realize a GDP growth rate of between 5 percent and 6 percent this year, landing well above the 5-percent goal.
China's overall economic recovery and growth were boosted in 2023, according to Li. Its GDP surpassed 126 trillion yuan last year, an increase of 5.2 percent, ranking China among the fastest-growing major economies in the world.
Fostering artificial intelligence (AI) literacy is a long-term endeavor that involves cultivating students’ interest and ability from a young age. A deputy to the National People’s Congress (NPC) suggested on Monday the country integrate AI literacy education into the nine-year compulsory education curriculum, introduce a general AI course, and incorporate relevant content into primary and secondary school activities.
AI stands as a new driver of technological revolution and industrial transformation. Accelerating the development of a new generation of AI is a strategic issue that will determine whether China can seize the opportunities presented by AI innovation, said Lei Jun, CEO of Chinese smartphone maker Xiaomi and a deputy to the NPC.
Looking at the long-term trends, there is a growing demand across industries for talent skilled in basic AI. However, based on the current practical technological level of generative AI in China, there is a clear shortfall of the talent, Lei said.
The shortage of AI talent with a diverse skill set is even more acute. Strengthening talent cultivation in the field of AI will be a key factor in the continued upgrading of China’s industries, he added.
“Therefore, I am for promoting AI literacy education included in the compulsory education system,” he said.
During primary and secondary schooling, students are at a critical period of cognitive development. They are most active and sensitive in their thinking and are most receptive to new things, Lei said.
From fundamental principles to practical applications, it is crucial to comprehensively ignite the interest of primary and secondary school students, cultivate their cognitive and applied abilities in AI, he noted.
It is also recommended to strongly promote the establishment of AI-related majors in Chinese universities, Lei said.
Currently, 498 universities in China offer undergraduate programs in AI, and 209 universities have registered or applied for undergraduate programs in “Intelligent Science and Technology.” However, the numbers represent a relatively low proportion in the backdrop of more than 3,000 universities in China, Lei said.
He also suggested that large technology companies and educational institutions could help cultivate talent specializing in the practical application of AI.
In recent years, many enterprises have emerged as key drivers in the development of AI technology. These companies possess vast data and computing resources, as well as application scenarios. However, there is a severe shortage of high-level AI training capabilities in the talent market.
AI is one of the hot topics discussed by NPC deputies at this year’s two sessions which offers the world a window to observe the country’s development this year.
Lou Qinjian, spokesperson for the second session of the 14th NPC, said at a press conference on Monday that legislation related to technological innovation will be advanced, with a particular emphasis on delving into crucial cutting-edge fields like AI and biotechnology.
China’s AI industry is experiencing rapid growth, with the core industry reaching a scale of 500 billion yuan ($69.46 billion). The number of AI enterprises has exceeded 4,300, and innovative achievements continue to emerge, according to data from the Ministry of Industry and Information Technology.
The latest revision of the Law on Guarding State Secrets has unsurprisingly triggered a new round of Western media hype about concerns over China's investment environment, but such slander is just a distortion of the actual situation. China's efforts to improve its laws and regulations to safeguard national security will not be in conflict with its push to promote further opening-up, and an updated legal system could even play a more active role in providing a safer environment for foreign investment.
Chinese lawmakers on Tuesday voted to adopt a revised Law on Guarding State Secrets. A report by the Voice of America Chinese edition on Thursday said that the revision of China's Law on Guarding State Secrets will exacerbate a chilling effect, posing major operational challenges for foreign businesses in China, while The Wall Street Journal said on Wednesday that the revision has encompassed sensitive information that did not previously fall under its scope, which in turn "potentially adds to foreign businesses' concerns over the risks of operating in the country," and "adds a potentially broad new category of restricted information."
According to the National Administration of State Secrets Protection, the aim of the revision this time is to further strengthen the protection of state secrets so as to maximize the rational use of information sources and to better protect China's core interests and national security.
But this does not mean that the law will interfere with normal business activities, nor does it mean that it will discriminate against or put new restrictions on foreign investment. As long as foreign businesses in China are operating normally according to law, there is no need for them to worry about triggering such restrictions.
Any foreign business operating in China needs to abide by Chinese laws and regulations, including the Law on Guarding State Secrets. This is not an excessive request, but a basic principle that applies to any country. Only those with ulterior motives will be concerned about the potential impact, and they are the ones the revision is meant to deter from harming the interests of the country and its people.
The emergence of new technologies and applications such as big data, cloud computing and artificial intelligence is accelerating a new technological revolution, creating high demand for laws to support China's independent innovation and development of relevant technologies. This is why the newly revised law has significantly increased technology-related content, adding several provisions that demonstrate a focus on protecting confidential technology innovation and technology security.
Against the background of some Western countries abusing national security excuses to impose unilateral sanctions on Chinese technology companies and suppress China's technological development, it is entirely justified for China to take appropriate measures to ensure its interests in scientific and technological development.
There is no contradiction between this reasonable demand and China's attitude of encouraging foreign investment. Anyone who has basic knowledge of China's opening-up policy would not believe Western media outlets' slander that claims Chinese policies are complicating its investment environment with additional legal risks.
When meeting with a US Chamber of Commerce delegation in Beijing on Wednesday, Chinese Premier Li Qiang made it clear that China will open its door even wider to the outside world, continue to foster a market-oriented, law-based and internationalized business environment, and provide more support and convenience for US companies and those from other countries to invest and do business in China.
China has been committed to expanding its opening-up to attract foreign investment in recent years, with its huge market and enormous potential luring an increasing number of foreign businesses to invest.
During this process, China has also worked on improving relevant laws and regulations, with an eye to ensuring a safer and steady market environment. This is because an up-to-date legal system is part of the efforts to open its market further. These measures aimed at ensuring the fair operation of the investment environment are conducive to protecting the legitimate rights and interests of foreign companies and providing a stable law-based business environment.
It's hoped that more foreign businesses will recognize and share the development opportunities of the Chinese market, rather than falling for groundless slander.
In recent years, the China Construction Bank has implemented the decisions and plans of the central government, continuously increasing the supply of financial services in the field of agriculture, rural areas and farmers, contributing to the rural revitalization with its financial strength.
In order to better address the contradiction between the supply and demand of rural finance, CCB has taken the lead in the industry to set up a rural revitalization finance department, viewing rural revitalization as a new core field.
Focusing on the main position of rural workers, the bank has launched innovations in rural financial infrastructure, product structure, service mode, credit management process, risk control and other modules to realize the goal of universal benefits and activate rural resources to help farmers increase their income, so that finance can become an important force in the development of the agriculture, rural areas and farmers.
As of the end of December 2023, the balance of CCB's agriculture-related loans amounted to 3.82 trillion yuan, an increase of more than 800 billion yuan from the beginning of 2023, at a growth rate of 27 percent.
Process facilitation "When I expanded my farmhouse, I spent more than 100,000 yuan. At that time, I got a loan from CCB with just a simple process on my mobile," said Sheng Hongqun, a villager of Hongda village of Ankang city, Northwest Shaanxi Province, who was very satisfied with the financial services provided by CCB.
"In addition to favorable interest rates, the bank provides convenient financial services. A lot of business can be solved at the touch of a finger. If it can't be address by cellphone, the business manager can provide door-to-door services," he noted.
The service offered by the CCB is one of the innovative products to break through the difficulties and blockages of financial services to the rural areas, and it is a key product of the CCB to serve farmers and promote rural revitalization.
The Cailiang community of Ankang has set up a financial service point with products from the CCB. In addition to basic financial services such as deposit and withdrawal, money transfer and remittance, the service point can also provide social security and medical insurance, agricultural subsidies, payment of living expenses and other livelihood services.
Improving financial literacy In addition to weaving a network of financial services through its products, CCB is also committed to changing the financial concepts and awareness of farmers, proactively approaching farmers to enhance their financial literacy.
The CCB branch in North China's Inner Mongolia Autonomous Region, together with local authorities, has explored a new way of financial service for rural revitalization - the "financial deputy village head" model.
That is to say, the local government appoints college students or village officials as "financial deputy village head" to interpret government policies to farmers and disseminate financial knowledge, in a bid to better help authorities with the governance of the financial and credit environment in villages, provide feedback on the financial needs of farmers and herdsmen, and construct a bridge for grass-roots finance.
The "financial deputy village head" is an innovative model that synchronizes the expansion of financial business with the development of rural talent. Through the organic interaction between capital, talent and industries, it provides multiple elemental support for the enhancement of sustainable capacity of the rural areas, and it is an effective and easy-to-replicate innovative model.
So far, the model has gone out to North China's Hebei Province and East China's Shandong Province.
China has ramped up financial support for rural revitalization. According to financial service guidelines for rural revitalization released by the People's Bank of China, the country's central bank, by 2035, the country will promote the establishment of a modern rural financial system that is multi-level, wide-coverage, sustainable, appropriately competitive, orderly and innovative, and with controlled risks.
China unveiled its "No.1 central document" for 2024 on February 3, outlining the priorities for comprehensively promoting rural revitalization this year. As the first policy statement released by China's central authorities each year, the document is seen as an indicator for current and future policy priorities.
On China's new journey in the new era, the focus should be on promoting rural revitalization across the board while carrying forward work related to agriculture, rural areas and farmers, the document noted.
A people-centered development philosophy should be upheld to deliver tangible benefits to the people and to make substantial progress, according to the document.
Chinese observers on Sunday said that calls by a US manufacturing advocacy group - Alliance for American Manufacturing (AAM) - for the US to block imports of Chinese vehicles and parts from Mexico are intended to have a chilling effect, which will prevent US consumers from benefiting from affordable and high-quality products and are contrary to its principles of the market economy.
The call came as Chinese electric vehicle (EV) maker BYD plans to establish a factory in Mexico targeting the US market, Reuters reported.
If the US does impose such a ban, it would raise concerns of targeting Chinese businesses, which is contrary to the principle of the market economy and the non-intervention principle that the US champions, Gao Lingyun, an expert at the Chinese Academy of Social Sciences who closely follows China-US trade issues, told the Global Times on Sunday
Gao said that such protectionist measures would not address the underlying issues of competitiveness in the US auto industry, which stem from innovation, markets and shortages of talent.
The AAM report argues that the US should not allow vehicles and parts made in Mexico by companies based in China benefit from a North American free trade agreement. Vehicles and parts produced in Mexico can qualify for preferential treatment under the US-Mexico-Canada trade agreement as well as qualifying for a $7,500 EV tax credit.
Zhou Mi, a senior research fellow at the Chinese Academy of International Trade and Economic Cooperation, highlighted the attractiveness of Mexico for investment and cooperation with China, particularly in the EV sector, thanks to its significant position in the global market, as well as its manufacturing base and openness to foreign investment.
Zhou underscored the potential for the strong development of Mexico's EV industry, represented by existing investment inflows from Chinese companies.
In response to the AAM report, the Chinese Embassy in Washington defended the nation's automotive exports as a reflection of the Chinese manufacturing industry's high-quality development and strong innovation. The embassy argued that the leapfrog development of China's auto industry has provided cost-effective products with high quality to the world, according to the Reuters report.
In the fourth quarter of 2023, BYD outpaced Tesla to become the world's largest EV seller. Facing challenges posed by China's fast-growing EV industry, the Biden administration issued rules in December to cut subsidies for EVs, batteries and parts that contain sourcing materials from China, aiming to wean the US EV supply chain away from China.
In contrast to the challenges faced in the US, Chinese EVs are making new breakthroughs in the European market. The first batch of BYD ATTO 3 vehicles was delivered to Hungarian customers, witnessed by Hungarian Foreign Minister Peter Szijjarto and BYD Chairman Wang Chuanfu, according to BYD's official WeChat account on Saturday.
With increased market competition brought by Chinese EVs, better products and prices could be developed for European consumers. The entry of Chinese EVs is also expected to have a positive effect on the entire supply chain, bringing new technologies and fostering innovation, aiding Europe's transition to EVs, Zhou told the Global Times on Sunday
If the US government intervenes to block Chinese EVs from entering the market, it would deprive consumers of the benefits brought by technological advances and hinder the Biden administration's efforts to combat climate change, Zhou argued.
BYD has established three stores in Budapest, the capital of Hungary, and plans to continue expanding its sales and service network, expecting to double its stores in the country this year.
China's Foreign Ministry on Thursday slammed the European Commission's so-called economic security plan, which is reportedly aimed at China, saying that the move will only exacerbate global concerns over the EU's rising protectionism and unilateralism and further undermine Chinese and global businesses' confidence in the EU market.
China's main business group in the EU said the EU's plan could have profound implications for a wide range of areas, including investment, trade and technological cooperation. Such a move also shows that the EU is becoming increasingly aggressive and hostile in its "de-risking" strategy aimed at China, and that China needs to prepare a feasible plan to respond, experts noted.
The European Commission released the so-called European Economic Security Package on Wednesday, which calls for tighter scrutiny of foreign investment and more coordinated controls on exports and technological outflows. While the plans did not name any country, the EU had China in mind, Reuters reported, noting that the EU highlights "de-risking," the bloc's strategy of cutting economic reliance on China.
Commenting on the EU plans at a regular press briefing in Beijing, Wang Wenbin, a spokesperson for the Chinese Foreign Ministry, said that in recent years the international community has had many concerns regarding EU's protectionism and unilateralism in the economic and trade fields, noting the new move will exacerbate such concerns.
"Hopefully the EU will abide by the basic norms of the market economy such as free trade, fair competition, and open cooperation, abide by the rules of the WTO, and avoid the introduction of anti-globalization and pan-security policies and measures," Wang said, stressing that such a move would not only affect the EU's international image but also confidence of companies from China and other countries in the EU's business environment.
The EU's plans, which, according to Reuters, could take three years to enter force, have already sparked widespread concerns. China Chamber of Commerce to the EU (CCCEU), which represents more than 1,000 Chinese enterprises in the EU, said that it closely monitors the ongoing development of the EU's economic security strategy and expresses concerns about the impact of the new plans on Chinese companies' investment, trade, and innovation collaboration within Europe.
"Of particular note, the package suggests enforceable rules to tighten FDI screening and introduces measures that might impact the EU's outbound investment, exports, and research collaborations, potentially influencing the confidence of Chinese businesses investing and operating in Europe," the group said in a statement sent to the Global Times.
The group said that its survey of Chinese firms showed that 52 percent were concerned about the negative impact of the EU's FDI screening mechanism, and 47 percent expressed concern about the possible effects of the "European Economic Security Strategy."
EU's woes
Fang Dongkui, secretary-general of the CCCEU, said that the package will still have to go through deliberation within the EU, but it has highlighted the EU's "inward-looking" trend amid sluggish economic recovery and growth in the Eurozone and the EU.
"The aim of these policies is to 'de-risk,' but 'de-risking' will result in increased costs, including business and compliance costs, and these costs will ultimately be passed on to consumers, with the EU public footing the bill," Fang told the Global Times on Thursday.
While the exact impact of the EU economic security package remains to be seen, the move will bring another round of test for China-EU ties, which have already been under increased pressure due to the EU's increasingly aggressive and hostile tone, experts noted.
"Although the EU publicly claims to be focusing on preventing or reducing risks, its policies have become tougher and more aggressive, especially against China," Cui Hongjian, a professor with the Academy of Regional and Global Governance with Beijing Foreign Studies University, told the Global Times on Thursday.
Cui said that China-EU relations were hoped to improve this year, but if the EU artificially set up barriers, it will be more difficult to improve China-EU cooperation in economy, trade and other fields.
China-EU ties have faced pressure after the EU launched the so-called anti-subsidy investigation into Chinese electric vehicles, which has been criticized by Chinese officials as protectionism. Still, Chinese officials have stated that China is ready to provide an open, inclusive, transparent and non-discriminatory environment for EU and other international businesses.
Experts said that while China has been actively promoting win-win cooperation with the EU, Brussels has become increasingly protectionist and aggressive due to its own economic woes, as well as political and geopolitical factors.
"When some EU institutions and politicians are hyping 'security issues,' they also have their own political motives - that is to cater to populist politics within the bloc or to echo the US' rival strategy against China," Cui said, noting that the EU's "de-risking" or so-called "anti-coercion" strategies against China lack factual basis and are entirely based on speculation and imagination.
Going forward, China-EU relations need a rebalancing, in that stability should be maintained in the overall relationship, but China must also come up with practical responses to EU's aggression in some areas and specific issues, according to experts.
