Further Opening-up Key for China’s High-Quality Development

Last week, the Central Economic Work Conference was held in Beijing. The conference discussed the plans, prospects and challenges for China’s economy heading into 2024, as well as evaluating the events of this year.

It goes without saying that 2023 has been a challenging year for countries around the world as the global context has been unsatisfactory. Various geopolitical tensions have created a rise in uncertainties which have led to reduced growth worldwide and sent many economies into stagnation.

In light of the critical factors affecting the stability of the global economy, China’s primary economic goal corresponds with the promotion and sustaining of free trade.

Despite headwinds created by the policies of the United States which amount to “anti-globalization” in the name of protectionism, national security and hegemonism, China’s fundamental interests pertain to resisting this through a policy of openness.

To this end, the country has applied to join multilateral agreements, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), while continuing to stake out bilateral free trade agreements (FTAs) with numerous countries. For example, China has recently concluded FTAs with Serbia and Nicaragua and is in the process of upgrading its ties with the Association of Southeast Asian Nations.

Moreover, China’s import and export of goods reached 34.32 trillion yuan in the first 10 months of this year, and 41,947 new foreign-invested enterprises were established – an increase of 32.1% year on year. The utilization of foreign investment in the high-tech manufacturing sector also increased by 9.5%.

Meanwhile, China is making great efforts to provide public platforms to the world, such as the China International Supply Chain Expo (CISCE), China International Import Expo (CIIE) and China International Fair for Trade in Services (CIFTIS).

China’s pursuit of free trade and opening-up contrasts sharply with the American position of “anti-free trade.” Having once believed that integrating global trade and capital was critical to spreading U.S. values and ideology, Washington has now come to believe that open economic engagement empowers “competitors,” who in a zero-sum sense contravene American interests and therefore the U.S. seeks to promote strategic “decoupling.” This has led to a wide variety of policies, such as growing tariffs, closing of market access, aggressive subsidization of industry and ever-growing export controls, which pose uncertainties to global free trade, economic stability and integration, damaging growth and investor confidence.

In the wake of this, China prioritizes opening up its markets to new investors around the world. As mentioned at the Central Economic Work Conference, it will foster new drivers of foreign trade, reinforce stable performance of foreign trade and foreign investment, and expand trade in intermediate goods, trade in services, digital trade and exports of cross-border e-commerce.

Specifically, the conference noted that market access will be eased for the telecommunications, medical and other service industries, while efforts should be made to align with high-standard global economic and trade rules, resolve issues such as cross-border data flow and equal participation in government procurement, and make “Invest in China” a popular choice. More favorable policies and measures are also expected to be taken to make it easier for foreigners to do business, study and travel in China.

China’s economic development has been achieved through the adoption of opening-up measures, and further opening-up is needed to achieve high-quality development in the future. The Central Economic Work Conference summarized that “confidence and determination must be boosted” and that if this is achieved, the potential benefits will continue to outweigh the risks concerning China’s economy.

The global environment is challenging, but the policies China is conceiving to move forward are ultimately positive through their emphasis on working to maintain the multilateral free trading system, and integrating further into the global economy, both through new agreements overseas and by opening-up and refining the economic system at home.