Strategic choice The policy comes as China seeks to leverage its huge domestic market
and the potential of domestic demand so that domestic and foreign
markets can complement each other, as it copes with an external
environment characterized by rising protectionism, a global economic
downturn and a shrinking international market. It is neither a contingency plan in response to industrial and supply
chains being severely affected by the pandemic nor a forced measure to
counter some countries' decoupling with China, said Huang Qifan, former
mayor of Chongqing and vice-chairman of the China Center for
International Economic Exchanges. It is a strategic choice China has adopted to step up the
coordination of domestic and international markets to make them
complement each other through more profound reforms and higher-level
opening-up, Huang said in a recent online symposium on China's economy
in Beijing. Given rising protectionism and unilateralism, as well as the impact
of COVID-19 on the global economy, Huang said that the more difficult
the situation China faces, the more firmly it is committed to expanding
opening-up in order to create new prospects from the changing situation. "We need to boost the international economic cycle with higher-level opening-up," he added. Since May, a number of new opening-up measures have been implemented
in China, such as the liberalization of foreign investment in financial
services. On June 1, China released the Overall Plan for the Hainan Free
Trade Port, including zero tariffs on specific goods, lower income tax
rates and a simplified tax system. Once operational, the port will
become another door opening for China to interact with the world. The third China International Import Expo, expected to be held in
Shanghai in November, is considered a sign of China's firm commitment to
win-win development through opening-up. It has drawn more registrations
from renowned companies compared with last year, and the average
exhibition area of Fortune 500 and leading companies will increase by 14
percent, fully demonstrating global businesses' confidence in China's
economic growth and prospects. Xi pledged at last year's expo that China will open wider to the
world. In a reply letter to representatives of Global CEO Council
members on July 15, Xi reassured the global CEOs that China will
continue to deepen reform and expand opening-up, and provide a better
business environment for investment and the development of Chinese and
foreign enterprises. Wang Huiyao, president of the Center for China and Globalization,
said China's opening-up will not only benefit itself, but also brighten
prospects for the world economy amid the current crisis. "China demonstrated its ability to accelerate global economic
recovery during the 2008 financial crisis, and now, amid the COVID-19
crisis, China is capable of helping the world move out of the
coronavirus shadow via continued opening-up and multilateral
cooperation," Wang said.
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