China's economic bounce welcome, positive for global growth, says business professional

BOAO, China -- China's progressive economic performance since the beginning of 2023 is a welcome development for the world and is positive for global growth, said a senior business professional attending the ongoing Boao Forum for Asia annual conference.

"Chinese economic data is definitely looking better over the past two months. We've seen a real ... bounce," said Ben Simpfendorfer, a partner at leading international management consulting firm Oliver Wyman.

"Particularly, manufacturing is up strongly, expanding new orders, which suggests that we're gonna see strength in production going forward," he said. "At the same time, retail sales are a little bit stronger: spending on restaurants, spending on gasolines as well as consumer staples are also strong."

China's retail sales, a gauge of consumption growth, increased 3.5 percent year on year in the January-February period, reversing declines seen in the previous three months.

In the first two months, China's value-added industrial output went up 2.4 percent year-on-year, while the index gauging the country's service industry output rose 5.5 percent.

"China's recovery means that it will play a more important role in driving global growth going forward, particularly in the year when worries about global recession are mounting," said Simpfendorfer, also a board member of the American Chamber of Commerce in Hong Kong.

He pointed out that China is a major importer of products for other economies, especially countries across Asia and the Middle East. "And so, recovery in demand (in China) would be most welcome."

"While we're on the right path to recovery, we need to see spending, both consumer spending as well as capital spending, begin to strengthen from here," said the expert, who has been working in Asia and the Middle East for over 20 years.

As this year marks the 10th anniversary of the China-proposed Belt and Road Initiative, the business expert noted that the growth-oriented initiative has been advancing collaboration in Asia, and its progress is a welcome and profitable development for the wider world.

"As the initiative's projects are collaborative and bringing multiple parties, especially local partners, it certainly helps in driving collaboration across the region," he said.

"At the same time, the initiative itself is beginning to evolve, which once focused on primarily very large-value infrastructure projects. We're beginning to see spending refocus on supply chains, particularly in Southeast Asia, business parks, ports, roads, anything that supports global manufacturing," he said.

"That's a welcome development because these types of investment are more likely to be profitable for investors," Simpfendorfer added.

He highlighted Asia's commitment to regional integration and economic globalization, saying the positive benefits of the region's backbone free trade agreements will continue to expand, which will ultimately propel global growth.

"Asia is home to two of the world's leading trade agreements, RCEP (Regional Comprehensive Economic Partnership) as well as CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership), which really underscores the fact the region's committed to globalization, committed to trade as a driver of growth," he said.

As Asia remains the world's largest manufacturing hub and a growing source of demand with around 60 percent of the world's population, its commitment to the free flow of goods and services "will ultimately be positive for global growth," he said.

Looking into the future, Simpfendorfer said Asia will emerge as "perhaps the world's largest trade bloc," and Asian integration boosts economic globalization.