What makes China’s treasury bonds ‘special’ as nation eyes quality growth?

Illustration: Tang Tengfei/GT

Illustration: Tang Tengfei/GT

The issuance of China’s ultra-long special treasury bonds has given those concerned about the nation’s economy a glimpse of the country’s pursuit of Chinese modernization through high-quality development.

Yet regrettably, opportunistic individuals on the outside seized the opportunity to chant about the “collapse of the Chinese economy.” Such allegations are ridiculous. 

China’s plan to issue the first batch of 1 trillion yuan ($140 billion) in ultra-long-term treasury bonds starting on Friday will help shore up investment and spur consumption, but this doesn’t mean the Chinese economy is facing numerous difficulties and challenges that require serious measures to stimulate growth.

Some Western commentators claim that China’s 2024 growth target of about 5 percent has put pressure on the nation to unleash more stimulus. Such a misreading reflects Western elites’ serious lack of understanding of China’s economic development.

China’s GDP grew by 5.3 percent in the first quarter of 2024, well above market expectations. Steady growth lays a solid foundation for the economy to achieve the target of growing by about 5 percent for the whole year.

China’s 5.3 percent growth in the first quarter was much higher than what many Western economies achieved in the same period. It’s a little bit ironic that while Western elites said “the Chinese economy is on the verge of collapse,” an indisputable fact is that China remains a major driving force for economic growth in the Asia-Pacific region and the world. 

That is not to say China faces no challenges and risks at all. Countries as large as China – and the entire world, for that matter – face mounting challenges and risks such as increasing geopolitical tensions, lower demand in developed countries, an uptick in trade restrictions and elongated supply chains.

In the face of challenges, China is actually making honest efforts to tackle them. As the world’s second-largest economy, China has been able to maintain economic stability.

There is no doubt that the issuance of China’s ultra-long special treasury bonds will help stabilize market expectations, elevate market confidence and inject new momentum into the Chinese economy, but this is not the whole story. The bonds are designed to be used to “support the implementation of major national strategies,” which makes them different from previous special treasury bonds.

To build a modern socialist country in all respects, we must, first and foremost, pursue high-quality development. The economy is undergoing a transition from old to new growth drivers, in which the optimization of structure, and the robust development of new quality productive forces, provide limitless possibilities.

Policies to encourage economic development are different in different eras of history. With the continuous growth of the Chinese economy, it is imperative to enhance and improve macroeconomic regulation with innovative tools and ideas to support long-term high-quality development. The issuance of China’s ultra-long special treasury bonds is an attempt to adapt to an optimized and upgraded economic structure and economic needs of the country.

The Government Work Report of 2024, which was approved during the two sessions earlier this year, stated that in order to “systematically address funding shortages facing some major projects for building a great country and advancing national rejuvenation,” it was proposed that, starting this year and over each of the next several years, ultra-long special treasury bonds be issued. 

“These bonds will be used to implement major national strategies and build up security capacity in key areas,” the report said.

China has turned to special treasury bonds before, in 1998, 2007 and 2020.

This issuance of China’s new ultra-long special treasury bonds is different from previous bond issuances, because the funds raised through the new bond sales are reportedly set to support scientific and technological innovation, integrated urban-rural development, coordinated regional development, food and energy security, and the high-quality development of the population.

The plan to issue new ultra-long special treasury bonds from 2024 is a proactive approach to pursue high-quality development and develop new quality productive forces, instead of forced measures to stimulate a “stagnant economy.”

The author is a reporter with the Global Times. [email protected]

Closer partnership between China, Serbia, Hungary to bear more fruits, creating many shared benefits

The Hungarian section of the Hungary-Serbia railway is under track-laying construction. Photo: Courtesy of the Hungarian branch of CREC

The Hungarian section of the Hungary-Serbia railway is under track-laying construction. Photo: Courtesy of the Hungarian branch of CREC

A track-laying machine made a rumbling sound as concrete sleepers are placed on the roadbed. Two-hundred-meter-long rails extend and fall steadily onto the sleepers through a mix of manual labor and high-tech machinery.

This has become a common scene during track-laying construction on the Hungarian section of the Hungary-Serbia railway, the flagship cooperative project under China-proposed Belt and Road Initiative (BRI). Here, extended railway lines are connecting scattered cities into an accessible and dynamic network, linking Hungary and Serbia, two Central and Eastern European (CEE) countries ever closer together.

Engaged in a wide range of fields such as transportation, high-end manufacturing and mining, Chinese companies have been actively promoting economic development in the regional countries. The companies bring with them advanced technology, high-tech equipment, modern management concept, and integrate them to better meet local development needs, contributing to the economic growth and improvement of the people’s livelihood there.

As the BRI now enters its second golden decade, this week’s state visits by China’s top leader chart the course for cooperation between China and the two CEE countries in their respective pursuit of high-quality development.

A number of Chinese companies rooted in Serbia and Hungary for many years have recently shared with the Global Times how they have achieved win-win cooperation and development under the BRI framework. The companies are looking forward to embracing new opportunities for high-quality development in the two countries.

Promotion of synergy

Along a section of the Hungary-Serbia railway in Hungary, which is been built by a Chinese company, track laying work is progressing smoothly. Since the job officially commenced at the end of May last year, about 70 percent of track laying work within the section has been completed, with the overall project completion rate exceeding 55 percent, the Global Times learned.

By the time of its completion, the regional transportation network will be significantly improved, providing greater convenience for both passengers and cargo delivery across the CEE economies.

The Hungary-Serbia railway could well illustrate how China’s BRI projects can help promote the regional economic synergy.

At a heavy equipment manufacturing plant in Ruma, Serbia, excavators and haulage vehicles were seen navigate through the site, accompanied by the rhythmic sounds of welding, cutting, and hammering. Amid this activity, workers diligently carry out tasks such as reinforcing steel bars and pouring foundation concrete, ensuring an organized and efficient work flow.

China Construction First Group has participated in the construction of the new factory project. With a keen focus on meeting the deadline, they aim to complete the prefabricated components during the second half of 2024. Once finished, this facility, owned by the Chinese company Haitian Group, will serve as a pivotal manufacturing hub for equipment like injection molding machines in the European region, the Global Times learned from China Construction First Group.

Chen Shuai, deputy general manager of the Fifth Construction Co, China Construction First Group, told the Global Times that the company is seizing the opportunity presented by the successful execution of the factory project in Serbia, to facilitate the expansion of China’s industrial manufacturing capacity overseas.

As the bilateral strategic partnership relations deepen, Chen holds strong expectations for further tapping into the potential for deeper cooperation for Chinese companies in Serbia.

Specifically, they will ramp up efforts to capitalize on the burgeoning development of infrastructure in Serbia, participating in projects spanning roads, bridges, tunnels, and renewable energy production, among other industrial lines, Chen said.

Serbia Zijin Copper DOO in Bor, Serbia, a joint venture between China’s Zijin Mining Group and Serbia, sets a good example of how the BRI prompts greater synergy in the regional development. By the end of 2023, the copper mine project in Bor had amassed investments totaling $2.498 billion, nearly double the promised investment of $1.26 billion in 2018, the company told the Global Times.

With a cumulative copper production of 356,000 tons and gold production of 9.8 tons, the project contributed nearly $500 million in taxes and fees and made a social contribution of $850 million, according to the company. Also, it created over 9,000 jobs. In 2023, the company achieved export revenues of around $720 million, significantly promoting the mutual development of stakeholders in Serbia.

Looking ahead, the company plans to add $1.2 billion in new investments in the next three years. The goal is to increase copper production of the copper mine in Bor from currently 120,000 tons per year to 220,000 tons per year by 2030, the company said.

High-quality growth

As the BRI embarks on its new journey after10 years of golden development, more possibilities will emerge in the cooperation between China and the regional countries.

The meetings between the top leaders of China and the regional countries this week have set the tone for deepening the bilateral ties while pushing the cooperation toward high-quality development.

In the joint statement signed on Wednesday between China and Serbia, both sides vowed to take the opportunity of entering a new stage of high-quality development in the joint construction of the BRI. They aim to deepen and expand cooperation in various fields, including trade, investment, technology innovation, digitalization, and telecommunications.

Meanwhile, China and Hungary are also expected to sign multiple cooperation agreements following the important meetings between leaders of the two countries, injecting new momentum into the development of bilateral relations.

In a recent interview with the Global Times, Chinese Ambassador to Hungary Gong Tao said that, in the future, both sides will continue to promote high-quality joint construction of the BRI, focusing on key areas such as digital economy, green development, and information technology.

During recent years, China has actively promoted cooperation with the CEE countries under the BRI. This initiative has yielded tangible benefits for the region, effectively enhancing connectivity between China, Eastern Europe, and the broader European region, Song Wei, a professor from the School of International Relations at Beijing Foreign Studies University, told the Global Times on Thursday, describing China-CEE cooperation as a role model for cross-regional collaboration.

Despite the marked progress, economic development in CEE is still encountering some challenges, including poverty reduction, and how to achieve faster economic modernization in the region, according to Song.

Song emphasized that amid the pursuit of high-quality cooperation and partnership, China will remain committed to further supporting CEE countries in integrating them into the global value chain.

Specifically, Song said that enhancing mutual investment programs, including on setting up joint investment funds, would incentivize more local enterprises in CEE to participate in the BRI.

The countries in the region are eager to draw from China’s successful developmental experiences. Therefore, both sides may intensify efforts to collaborate on a series of training programs and exchanges, facilitating mutual learning and development in the future, Song said.

“The commitment aims to foster closer economic and trade ties between China and the CEE economies, assisting the region to better tackle its corresponding challenges in the future,” Song said.

China will continue to assist Asia-Pacific countries to rapidly develop their economies under BRI framework: experts

An electric multiple unit (EMU) machinist trainee tries the high-speed train simulator at Tegalluar High Speed Train Depot of the Jakarta-Bandung High-Speed Railway in Bandung, Indonesia, on January 17, 2024. Photo: VCG

An electric multiple unit (EMU) machinist trainee tries the high-speed train simulator at Tegalluar High Speed Train Depot of the Jakarta-Bandung High-Speed Railway in Bandung, Indonesia, on January 17, 2024. Photo: VCG

Chinese Foreign Minister Wang Yi recently concluded his successful visit to three Asia-Pacific countries, displaying China’s willingness to strengthen cooperation with the region.  As good friends and economic partners based on mutual respect, equality, and mutual benefit, China’s relations with regional countries are evolving and constantly reaching new heights.

One important focus of Wang’s trip was the high-quality construction of the Belt and Road Initiative (BRI). China’s cooperation with Indonesia, Cambodia, and Papua New Guinea under the BRI platform has yielded fruitful results.

In Indonesia, the Jakarta-Bandung High-Speed Railway has become the first high-speed railroad in Southeast Asia, delivering tangible benefits to local development and improving livelihoods of many Indonesians.

In Cambodia, highways constructed with Chinese aid and industrial parks built by Chinese companies have become important drivers of local economic development.

As the first Pacific island country to sign a memorandum of understanding and cooperation with China under the BRI, Papua New Guinea has become China’s largest trading partner, investment destination, and engineering contracting market in Pacific island countries. 

Unlike the US’ past efforts in the Asia-Pacific region, often attached with political strings and hardly bearing any substantive results, China’s cooperation and assistance to the countries in the region are based on principles of mutual respect, equality, and win-win, without imposition of any political conditions, experts said.

As the BRI celebrated its 10th anniversary last year, embarking on a new journey of high-quality development, experts said that China’s cooperation with Asia-Pacific countries will continue to focus on helping regional countries achieve sustainable development and improve locals’ livelihood. This includes enhancing cooperation in emerging areas such as green development and digitalization.

Friends and partners

During Chinese Foreign Minister Wang’s recent visit, important exchange meetings with regional countries were held, including the Fourth Meeting of the China-Indonesia High-level Dialogue Cooperation Mechanism co-chaired by Wang and Luhut Binsar Pandjaitan, Indonesia’s coordinator for cooperation with China and coordinating minister of maritime affairs and investment, as well as the Seventh Meeting of the China-Cambodia Intergovernmental Coordination Committee, co-chaired by Wang and Cambodian Deputy Prime Minister Sun Chanthol.

High-level interactions provided clearer direction for future cooperation under the BRI between China and the three countries. 

Chinese Foreign Ministry spokesperson Lin Jian, while describing Wang’s visits, used a common description when referring to the three countries as “good friends and good partners” based on the principles of mutual respect, equality, mutual benefit and shared development.

That characterization is fair and fitting, given the well-known friendly relations between these three countries and China, experts said, noting that the joint construction of the BRI serves as an accelerator for the continuous growth and enhancement of friendly cooperation between China and the regional countries.

The tangible results under the joint initiative are evident for all to see. 

Last week, the Jakarta-Bandung High-Speed Railway marked its sixth month of operation with a total of 2.56 million passengers being transported. Since its official operation around mid-October, the railway has operated a total of 7,050 rides with a mileage of over 1.26 million kilometers, Xinhua News Agency reported, citing data provided by PT Kereta Cepat Indonesia-China, a joint venture consortium between Indonesian and Chinese state-owned firms that constructs and runs the HSR.

In the Sihanoukville Special Economic Zone, a landmark project under the BRI in southwestern Cambodia, changes have taken place with the participation of Chinese companies. Over the past decade, the economic zone, a joint venture between Chinese and Cambodian companies, has drawn more than 175 companies from countries including China, Europe, the US, Southeast Asia and other regions to settle there, creating more than 30,000 local jobs.

Papua New Guinea, the largest Pacific Island country, was the first country to sign a memorandum of understanding and cooperation plan in the region for jointly building the BRI.

The Juncao and Upland Rice Project has been implemented in Papua New Guinea for over 20 years, benefiting more than 40,000 local people. The country’s Prime Minister James Marape referred to Juncao technology as a “gift from China to the world,” with Juncao now known locally as the “grass of happiness” and “grass of prosperity.”

China and Papua New Guinea are engaging in negotiations to reach a free trade agreement, and the talks are expected to be completed by June, Chen Hong, director of the Australian Studies Center of East China Normal University, told the Global Times on Thursday. 

Chen noted that this illustrates that China’s cooperation with Asia-Pacific countries is genuinely based on mutual benefit, using strong economic ties to drive overall cooperation and improve local economies and living standards.

China’s foreign minister’s trip to the Asia-Pacific is of landmark significance as the current relations between China and the regional countries have continued to improve and have reached a very important moment, Zhao Gancheng, a research fellow from the Shanghai Institute for International Studies, told the Global Times on Thursday.

Against the background of a volatile international landscape, China continues to adhere to multilateralism and inclusive growth in the region, despite the protectionism and egoism of the US, Zhao said.

China’s cooperation with the countries differs significantly from that of the US-led West, which often prioritizes its own strategic objectives before local interests, Chen said.

Stark contrast

While the US pledges in the Asia-Pacific often fails to materialize, resulting in empty promises and broad disappointment, China’s cooperation under the BRI in the region is in stark contrast – Chinese involvement directly improves education, healthcare, employment and more in the region, Chen said.

During Wang’s visit in Indonesia, he referenced public expectations to expand bilateral cooperation in three key directions – digital economy, green development, and improvement of people’s livelihood, under the framework of the BRI.

As the BRI is entering a new phase of high-quality development, new opportunities in green economy and digital economy are emerging as countries pursue sustainable development. The extent of Belt and Road cooperation in Asia-Pacific will undoubtedly be expanded to include new frontiers like clean renewable energies and electric vehicles and more, which also signify new quality productive forces in the coming wave of high-quality development, Chen said.

What needs to be tackled next, according to Zhao, is to complete cooperation projects that were disrupted by the COVID-19 pandemic. At the same time, China’s cooperation with regional countries will always be kept as open and transparent and lead to more tangible results for local residents. 

“Infrastructure development have been and will continue to be an important part of the BRI cooperation in building quality roads, bridges, railways and other crucial infrastructure,” Zhao said. The economic partnership will only get closer and stronger, he added. 

GT Voice: Xinjiang’s green devt experience valuable to Western economies

Illustration: Xia Qing/Global Times

Illustration: Xia Qing/Global Times

Northwest China’s Xinjiang Uygur Autonomous Region has emerged as a prominent symbol of China’s progress in new-energy development. Its leading position in the new-energy field can offer concrete evidence showcasing China’s efforts to maintain stability, promote economic development and enhance people’s livelihoods in the region. 

These tangible achievements speak volumes, countering baseless Western hype over alleged human rights issues.

The installed capacity of new energy in Xinjiang has exceeded 70 million kilowatts (kW), accounting for about half of the region’s total installed capacity, the Xinhua News Agency reported on Tuesday, citing data from the State Grid Xinjiang Electric Power Co.

Xinjiang now ranks among the top markets in terms of its installed capacity of new energy and the capacity proportion of new energy. Even on a global scale, these are remarkable signs of progress. Only a handful of European countries, such as Denmark, get 50 percent of their electricity from wind and solar power.

Xinjiang’s achievements not only mark a major advance in China’s new-energy development but also provide the world, especially Western countries, with valuable experience in green development. 

Some American politicians are advised to learn about China’s efforts in achieving rapid green growth in Xinjiang, so as to give meaningful consideration to facilitating their country’s green development, instead of spreading lies about Xinjiang.

Xinjiang boasts of some of the largest new-energy resources in China. Total reserves of wind energy resources in Xinjiang are estimated at about 890 million kW and the exploitable amount of wind energy resources accounts for 15.4 percent of the country’s total. 

The exploitable amount of solar energy resources accounts for 40 percent of the country’s total, ranking top worldwide, according to local authorities.

In recent years, Xinjiang has capitalized on its natural advantages in energy and other resources, actively promoting the development of renewable energy. This has led to significant progress in adjusting the region’s energy structure, with the rapid construction of large-scale wind power and photovoltaic base projects. 

Xinjiang has installed 35.68 million kW of wind power and 34.35 million kW of photovoltaic power. Under the 14th Five-Year Plan (2021-25), the region approved 180 gigawatts of new-energy capacity, with installed capacity estimated to exceed 89 million kW by the end of 2024. By then, new energy is expected to become the primary power source in Xinjiang.

Over the years, the rapid development of new energy in Xinjiang has been greatly facilitated by China’s policy of boosting development in the country’s western region, aiming to bridge the development gap with the eastern region.

It is under the guidance of the central government’s policies covering the western region that Xinjiang has increased its investment and support to the new-energy industry, actively driving the transformation and upgrading of the local economy. 

Accelerated economic development has also benefited people in Xinjiang, which is conducive to promoting social stability. 

Xinjiang’s transformation of its resource advantage into economic development advantage has not only ensured electricity supply for the local population, but also boosted local employment. 

While promoting the construction of new-energy projects, Xinjiang also prioritizes ecological protection, achieving a harmonious balance between economic development and environmental protection.

The experience of Xinjiang in new-energy policies, investment and infrastructure construction demonstrates that government guidance and support can expedite the growth of the new-energy industry. 

As the world strives to achieve green development and address climate change, Xinjiang’s example in the area of new-energy development could serve as a valuable reference for other countries, especially those in the West.

RISC-V chip tech curb on China ‘to harm US firms’

A chip manufacture machine Photo: VCG

A chip manufacture machine Photo: VCG

The US is reportedly working to review the potential risks of RISC-V chip technology being used by major Chinese technology companies, which is seen as a new front of the expanding technology war initiated by the US that aims to curb China’s development in the sector.

Observers said that the US will find it difficult to restrict China on RISC-V technology and that if it does so, US companies could bear huge losses and the global supply chain could be affected.

The US Department of Commerce is reviewing the national security implications of China’s work in open-source RISC-V chip technology, Reuters reported on Tuesday, citing a letter the department sent to US lawmakers.

Any restrictions could set off a chain reaction and create uncertainty for the initiators themselves, Zhang Xiaorong, director of the Beijing-based Cutting-Edge Technology Research Institute, told the Global Times on Wednesday.

“As an open-source technology, RISC-V is widely used in the design of the Internet of Things. China’s contribution to the technology is strong,” said Zhang.

According to Reuters, the US Commerce Department letter said that it is “working to review potential risks and assess whether there are appropriate actions under Commerce authorities that could effectively address any potential concerns.” 

But the Commerce Department also noted that it would need to tread carefully to avoid harming US companies that are part of international groups working on RISC-V technology. Previous controls on transferring 5G technology to China created roadblocks for US firms working in international standards bodies where China was also a participant, risking US leadership in the field, according to Reuters.

Analysts said that the letter shows that the US action is about technology dominance, not open-source development.

RISC-V, pronounced as “risk five,” is a set of basic instructions that tell a chip how to perform a computing task. It provides a common language for designing processors used in devices such as smartphones, disk drives, Wi-Fi routers and tablets, according to RISC-V International, a non-profit managing RISC-V technology.

Since RISC-V is an open-source technology, if the US imposes restrictions, it will slow down the global development of the technology, Ma Jihua, a veteran telecom industry observer, told the Global Times on Wednesday. 

If the US imposes restrictions, it may only restrict American companies that do RISC-V research and development and production from cooperating with Chinese companies, Ma said.

“It’s similar to … when the US sanctioned Huawei [and] American companies weren’t allowed to participate in international conferences or organizations where Huawei was present. However, the ban was eventually revised because Huawei was seen as more important to many international organizations than some American companies,” said Ma, and it will be the same with RISC-V technology.

Controlling China’s access to RISC-V technology, however, is easier said than done, said an analysis published by the Center for Security and Emerging Technology (CSET), a policy research organization within Georgetown University, in January.

RISC-V International moved its headquarters from the US to Switzerland in March 2020 in part to insulate itself from the creeping influence of geopolitics on the chip industry. This move severely limits the US government’s regulatory options, according to CSET.

GT Voice: West’s overcapacity narratives can’t define China’s cooperation with developing nations

Illustration: Liu Xidan/Global Times

Illustration: Liu Xidan/Global Times

Chile has imposed temporary anti-dumping tariffs on Chinese steel products used in the country’s mining industry in a bid to support local producers, Bloomberg reported on Monday, citing a decree published over the weekend.

The individual case came at a time when US and European media outlets have unleashed a new wave of criticism and bad-mouthing of China’s economy, raising the alarm about shocks that so-called Chinese overcapacity will have on the global economy.

For instance, a recent report by the Wall Street Journal claimed that “cheap Chinese steel exports have flooded world markets.” Such a climate of opinion is based on groundless accusations and does not hold water.

Overall, the demand for steel products in the Latin American market is on the rise, and local steel companies are struggling to keep up with this demand. The introduction of Chinese steel products into the Latin American market has proven to be beneficial to the economic development of the region. For a long time, Latin American steel companies have faced the challenge of competition from Chinese steel products, which has led to friction in steel trade, and this is not a new problem.

Local anti-dumping measures against Chinese-made goods are not a new problem, either. China has attached great importance to these issues in recent years and has taken steps to address these issues by promoting cooperation, especially by enhancing complementarity or through investment. This is completely different from the US, which has imposed bans on Chinese-made products. The entry of Chinese-made products into developing markets has generally been beneficial to the development of these countries. Moreover, China has never resorted to coercive tactics to achieve the sale of these products, unlike Western powers did in the past.

Western attempts to depict some of China’s most competitive exports as a threat to global markets clearly have ulterior motives. Such hype often ignores the fact that the reason why Chinese products, especially steel, are so competitive in the global markets is because they are not only reasonably priced but also have reliable quality.

When it comes to playing up so-called overcapacity in China, the criticism by Western politicians and media outlets of Chinese products often reeks of protectionism, and conceals an incentive to evade competition with Chinese producers.

What is even more incomprehensible is that some US politicians have criticized Chinese products such as steel and electric vehicles, giving the impression that employment and industries in the US have been significantly affected by Chinese imports. However, the reality is that they have not bought much steel or many electric vehicles from China.

This suggests that there are geopolitical purposes to their economic criticism of China. Their attempt to smear Chinese products and squeeze them out of the global market with the “overcapacity” narrative is aimed at curbing China’s development by weakening the competitiveness of Chinese products.

At a time when the West is unable to provide greener, more affordable and more practical products that align with the needs of the developing world, it is resorting to spreading misinformation about Chinese products in an attempt to hinder developing countries from accessing the necessary resources.

This approach, which highlights Western selfishness and arrogance toward developing nations, is essentially an effort to maintain Western dominance in the global economy by keeping developing countries as suppliers of low-end goods, rather than fostering them as equal partners. This self-serving attitude disregards the pressing need for industrialization and economic diversification among developing countries, an obstacle to the balanced development of the global economy.

Developing countries are facing challenges during their industrialization process, such as access to capital, technology and infrastructure development. In this regard, Chinese products offer a solution by providing raw materials and machinery at competitive prices and with reliable quality, catering to the economic development needs of these nations.

By utilizing Chinese steel, machinery and other industrial goods, developing countries can lower the costs of industrialization and expedite the pace of their industrial growth.

Moreover, China’s collaboration with developing countries goes beyond commodity trade, encompassing manufacturing and infrastructure investments. Frameworks like the Belt and Road Initiative have facilitated extensive cooperation between China and developing nations in infrastructure construction, energy development, transportation and more. This collaboration plays a crucial role in advancing the industrialization and economic growth of developing countries.

In short, Chinese products and investments offer a boost to the industrialization of developing nations. It is imperative for them to capitalize on the opportunity to collaborate with China instead of being carried away by Western narratives.

China to build data labeling bases nationwide to promote AI devt: National Data Administration

The photo taken on October 12, 2023 shows the server room of the advanced data center in Western (Chongqing) Science City. Photo: VCG

The photo taken on October 12, 2023 shows the server room of the advanced data center in Western (Chongqing) Science City. Photo: VCG

China will establish a data labeling base to facilitate the nation’s artificial intelligence (AI) development, the National Data Administration (NDA) announced at the nationwide data work conference in Beijing as it outlined key tasks for this year.

According to the meeting, efforts will be made to explore the establishment of national-level data labeling bases, fully leverage local support and leading companies to promote the development of AI industry ecosystems, China Media Group reported.

Efforts also will be made to accelerate the building of a nationwide computing power network to address the growing demand of China’s computing networks estimated at an annual growth over 30 percent, officials said.

The NDA is focusing on integrating the development of general computing power, intelligent computing power, and supercomputing power and coordinating the computing power across different regions.

Among the key work, the NDA will also establish a data property rights system, promote efficient and compliant data circulation and trade, and ensure data security governance.

Deploying these measures is crucial for driving the development of the digital economy, optimizing resource allocation, and promoting industrial upgrading, Wang Peng, an associate research fellow from the Beijing Academy of Social Sciences, told the Global Times on Tuesday.

The building of a nationwide data labeling base can allocate professional labeling resources to label data at high quality and large scale, improving the data quality for training AI models. It could also explore new data labeling techniques and methods, driving the overall advancement of the AI industry, Wang said.

The move to accelerate a national integrated computing power network will further enhance computing power efficiency, reduce costs, and support the development of the digital economy, Wang added.

China inaugurated the National Data Administration last October to promote digital development and enhance management on data regulation amid efforts to boost digital economy and data security.

So far 31 provincial-level regions in the Chinese mainland have established their regional data institutions, the NDA said.

China will launch an AI Plus initiative to promote the innovative development of digital economy, according to the Government Work Report.

The country will step up research and development and application of big data and AI, launch an AI Plus initiative, and build digital industry clusters with international competitiveness, read the report.

Debunking flawed Western narrative – ‘China’s economy peaks’

A view of the skyline of Beijing's CBD area. Photo: VCG

A view of the skyline of Beijing’s CBD area. Photo: VCG

Bearish views about China’s economy appear from time to time but are always proved wrong. Recently, some Western politicians and institutions have come up with the “China peaks” theory, which may seem novel but is exactly the same as the so-called “End of China’s economic miracle” theory back in 2013. 

History is a long-cycle development process, and arbitrary claims of “peak” and “end” often go against logic and common sense.

Over the past decade, the Chinese economy has been moving forward and experiencing waves of development, despite the Western hype shifting from “disappointing” to “near collapse.” In 2023, China’s GDP surpassed 126 trillion yuan, with per capita disposable income at 39,218 yuan, more than double the figures of 56.8 trillion yuan and 18,311 yuan in 2013. The 5.2 percent growth rate is also significantly faster than the US’ 2.5 percent, the eurozone’s 0.5 percent, and Japan’s 1.9 percent. With its contribution to world economic growth continues o exceed 30 percent, China remains an important engine of global economic growth.

In the face of the rosy data and solid facts, where did the “China peaks” theory come from?

First, the “pandemic impact” rhetoric says that the COVID-19 pandemic has accelerated the process of peaking.

Indeed, the three-year COVID-19 pandemic has had a significant impact on both the world and the Chinese economy. But historically, no matter how severe a pandemic is, it is a short-term issue. No matter how big the impact on the economy, it will not fundamentally change its long-term development trend. China was the first major economy that saw growth resume after the pandemic. Now, its “scar effect” on China’s economy has faded. Last year, the total retail sales of consumer goods in China exceeded 47 trillion yuan, up 7.2 percent year-on-year, indicating that consumption is again driving economic growth.

Businesses are also booming. Boosted by last year’s May Day holidays and National Day holidays and this year’s Spring Festival, renowned domestic brands have introduced new products, various places have promoted local tourism, and a variety of new consumption scenarios have emerged. Whether it is the night economy in Changsha, or the Hangzhou Asian Games, China’s economic recovery is clear for everyone to see. This surging energy is propelling China’s high-quality development forward with renewed vigor.

Second, the “demographic dividend” narrative argues that, with China’s total population now peaking, the disappearance of the demographic dividend will make China’s growth miracle of the past 40 years unsustainable.

In recent years, significant changes have taken place in the size and structure of China’s population. But there are still about 865 million people aged 16 to 59, who are at working age. With the labor participation rate at a relatively high level in the world, China still has abundant labor resources and its demographic dividend hasn’t gone away. Furthermore, in terms of economic development, the input of the labor force is important, but the input of effective labor is even more important. Effective labor can be defined as the product of the number of workers and their level of education. Essentially, compared with the size of the population, the quality of the population is a key determinant of long-term economic growth.

At present, the average years of education of the working-age population in China have risen to 11.05 years, and the number of people that have had higher education has exceeded 240 million. China boasts the largest number of science and technology professionals, as well as research and development personnel globally. China’s large number of science and engineering graduates has formed an “engineer dividend.” Overall, despite the aging population, effective labor has been increasing every year, transitioning from a “demographic dividend” to a “talent dividend.” This offers solid human resources foundation for high-quality development.

Third, it has been claimed that the US’ technological suppression and decoupling will hinder China’s development. This argument suggests that China is still in the process of technological transformation, and Western tech blockades will impact the development of China’s high-tech industry and stymie China’s economic rise.

Can technological suppression block China’s development path? The question has been answered by history more than once. China has been repeatedly besieged and suppressed, but has been able to overcome difficulties even when the economy was still underdeveloped. Today, given the solid material and technological foundations in China, the so-called “small yard high fence” attitude will not stop China’s innovation and development.

Today, China remains committed to keeping its doors open and continues to advance in technology through independent development. China has increased its investment in technological innovation and achieved remarkable progress.

For instance, the domestically produced C919 large passenger aircraft has entered commercial flights. The homegrown large cruise ship has also started commercial operation, and the Shenzhou series of space missions have achieved remarkable success.

China’s cutting-edge technology field is constantly accumulating energy, demonstrating the strength of Chinese innovation. China has the largest number of global top-100 technology innovation clusters in the world, and emerging technologies such as artificial intelligence and blockchain are growing in importance. New-energy vehicles, lithium batteries, and photovoltaic products have become new highlights of China’s manufacturing industry.

China is leveraging the advantages of a new type of national system with concentrated efforts and resources for important events or projects, with abundant talent, a huge market, and complete industrial support. The innovation drive and development vitality of China are flourishing, and new quality productive forces are emerging, demonstrating strong support for high-quality development.

Fourth, it has been claimed that a slowdown in economic growth suggests that a “peak” has been passed. This claim argues that the miracle of high-speed growth of the Chinese economy brought about by special domestic and international opportunities is unsustainable, and that China will fall into a growth stagnation predicament.

After more than 30 years of high-speed growth with an average annual GDP growth rate of 9.9 percent, the growth rate of the Chinese economy has indeed slowed down in recent years, but this is a natural result of the evolution of economic development. 

Throughout history, economies have typically experienced a natural decline in growth rates, transitioning from periods of rapid growth to more stable, moderate growth. This trend is commonly observed in the development of modern economies and is considered an inevitable occurrence. 

In the industrialization process of various countries, such as Germany, Japan and South Korea, after experiencing two to three decades of high-speed growth, the pace of the growth will slow down. This is an entirely normal phenomenon.

Moreover, the phased transition of China’s economic growth is intertwined with the long-term structural adjustment of the world economy and the integration of a new round of industrial revolution. If China continues to pursue high-speed growth, it would not only go against economic laws, but also exacerbate the existing contradictions of traditional extensive growth methods, bringing many risks and causing economic imbalance, lack of coordination, and unsustainability. 

Transitioning to a new stage of growth also means changing the driving forces. Outdated productivity continues to decline, while advanced productivity continues to emerge, forming new growth momentum.

Observing the theme of high-quality development in the Chinese economy, one should not only look at the size, but also the quality. Combining growth data and efficiency data from recent years, the Chinese economy has not peaked at all, but has achieved a qualitative and effective improvement while overcoming many difficulties. 

Currently, China’s comprehensive advantages in human resources, capital formation, infrastructure, and industrial system are outstanding, and the potential for economic development is huge.

For example, the savings rate is still at a high level; a relatively complete and large-scale infrastructure network has been formed; and a large-scale, comprehensive, and strong complementary industrial system has been established. According to calculations by many domestic and foreign research institutions, China’s potential growth rate can still reach around 5 percent for the long run.

Those who repeatedly curse the Chinese economy have had their views rebutted by the facts. Whether it is simply applying Western theories to analyze the Chinese economy, exaggerating short-term issues, having a subjective bias, or acting out of narrow self-interest, the smears are based on misconceptions about the Chinese economy.

The Chinese economy has been advancing steadily, with firm goals and adjustments that keep pace with the times.

Looking into the future, China’s economy has solid support from its huge material and technological foundations, advantages in supply capacity with a complete range of industrial sectors, potential demand advantages from the huge domestic consumer market, talent advantages, advantages in emerging industries, and advantages in continuous institutional innovation through reform and opening-up.

In developing new quality productive forces, the growth potential of the Chinese economy will continue to be unleashed.

China’s economy is currently at a crucial stage of transitioning toward high-quality development. During this process, various problems and challenges are inevitable, such as insufficient effective demand, overcapacity in some sectors, weak social expectations, and numerous hidden risks. China is addressing these problems, making effective use of ample policy space, and continuously introducing targeted measures to resolve them. The performance of China’s economy in 2023 was the best proof.

American scholar George Friedman, who announced the “end of the Chinese economic miracle” a decade ago, wrote that “no one country can replace China, but China will be replaced. The next step in this process is identifying China’s successors.”

Ten years on, China has recorded ever outstanding and profound development achievements: The next China is still China!

The article is an economic commentary first published in The Economic Daily. [email protected]

China’s Douyin bans AI generated content to spread misinformation, rumors

Douyin Photo: VCG

Douyin Photo: VCG

 

Chinese short video platform Douyin has banned the use of artificial intelligence generated content (AIGC) to create and post content that goes against science, fabricates information, or spreads rumors, according to a notice on its WeChat account on Wednesday. 

The issuance of the regulation is timely and necessary to promote the orderly development of the AI industry, experts said.

Douyin said that it has recently identified and taken action against accounts that are using AI to create virtual humans and post inappropriate content.

It urged creators, live-streamers, users, and merchants on the platform to follow a five-point regulation when using generative AI on the platform. 

The creator of AI content must clearly label it so others can determine if it is real or not, and must take responsibility for any consequences resulting from the content. 

Virtual humans must be registered on the platform, and users of the technology must undergo identity verification. 

The platform also prohibits the use of AI to create and share content that infringes on the rights of others, including images and intellectual property. It prohibits AI-generated content that goes against science, spreads untruths, or creates rumors. If such content is found, the platform will impose strict penalties.

The issuance of the regulation comes as AI technology has sparked controversy across the world. There is growing concern that AI-generated literature is becoming a challenge to human-created works. Additionally, there is debate over whether AI-facilitated digital figures of the deceased would be acceptable for families.

 

“This regulation is necessary, as it aligns with policy guidance and meets the needs of platform development. With quick development of AIGC, it is essential to have regulations in place to label the content and make clear the accountability,” Liu Dingding, a technology industry observer told the Global Times on Wednesday.

China has placed increased emphasis on AI technology in the pursuit of new quality productive forces and economic growth, and has stepped up AI governance to ensure that it is used for the benefit of the people.

The Cyberspace Administration of China (CAC) and six other ministries issued temporary rules for managing generative AI services in July, in a bid to promote the sound development of the sector, safeguard national security and the public interest, while also protecting the legitimate rights and interests of individuals.  

The temporary rule, which has been in force since August 15, emphasizes that the use of generative AI should follow China’s laws. 

Any act of generating or transmitting illegal content will be terminated on the spot, and illegal content will be erased. Generative AI technology providers should offer specific data processing training in line with the law. 

The CAC said the rapid development of generative AI technology has brought new opportunities for economic and social development, while also giving rise to problems misinformation, infringement of personal rights, bias and discrimination, noting that how to co-ordinate the development and safety of generative AI has aroused public concern. The CAC emphasized that the rule was made to underpin the healthy development of generative AI technology. The rule encourages the innovative development of generative AI technology.