New growth drivers to be cultivated

Updated: Aug 2, 2022 By Ouyang Shijia, Zhou Lanxu and Zhong Nan Print
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A photo shows the view of CBD area in downtown Beijing. [Photo/Sipa]

China is firmly committed to cultivating new growth drivers to address challenges from both home and abroad, securing a decent growth for this year and fostering high-quality development for the future.

Yi Huiman, chairman of the China Securities Regulatory Commission, highlighted the key role of capital markets in funding innovative industries.

As China's economic restructuring is in a crucial period, the nation will give full play to the role of capital markets in promoting direct and indirect financing, supporting funding for emerging industries and promoting the transformation and upgrading of traditional industries, Yi wrote in an edition of the Qiushi Journal, the flagship magazine of the Communist Party of China Central Committee, published on Monday.

Yi's remarks came after Guo Shougang, deputy director-general of the equipment industry department at the Ministry of Industry and Information Technology, emphasized the importance of boosting technological innovation and industrial transformation at the Global Future Science and Technology Innovation Cooperation Conference in Beijing last week.

To provide a better environment for industrial development, China will upgrade services in auto manufacturing, remove caps on contract manufacturing in an orderly manner, and intensify the regulation of product safety, cybersecurity and data safety, Guo said.

Despite the recent impact of the COVID-19 pandemic and changes in the international environment, experts believe China has the ability to keep economic operations within a reasonable range in 2022, and they expect to see a steady rebound in the second half of the year through more policy stimulus and infrastructure funding.

David Wang, chief China economist at Credit Suisse, said infrastructure investment, including green investment, will be the key driver of recovery in the second half.

As for emerging industries and economic upgrading driving potential growth in China, Wang's team expects a modest acceleration in the country's technological progress over the next five years.

Liu Shijin, deputy director of the Committee on Economic Affairs of the National Committee of the Chinese People's Political Consultative Conference, the nation's top political advisory body, said the country should pay more attention to deepening reform and opening-up and to unleashing the potential of innovation in the second half to stabilize the economy.

While macroeconomic adjustments deal with short-term downward pressures, the ultimate impetus for growth can come from tapping into structural growth drivers, Liu said at a recent news conference.

The People's Bank of China, the nation's central bank, said at a work conference on Monday that it has provided strong financial support for stabilizing the overall economy, and medium and long-term loans to manufacturers have increased notably.

For the second half of 2022, a recent meeting of the Political Bureau of the CPC Central Committee urged efforts to consolidate the upward trend of economic recovery, keep the economy running within an appropriate range and strive for the best possible outcome.

It was decided at the meeting that major economically developed provincial-level regions should play a leading role, and eligible provinces should strive to meet the objectives set for economic and social development this year.

Liu Dian, an associate researcher at Fudan University's China Institute, said that as China is gradually shaking off the impacts of the pandemic, regions hit hard by COVID-19 outbreaks, such as Shanghai and Jiangsu province, will gradually recover in the second half.

Liu said more efforts should be made to foster new growth drivers, with a key focus on boosting the development of modern services as well as emerging high-tech sectors, such as new infrastructure, digital economy and green development.

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