Li Yuanchao, Vice-President of the People’s Republic of China, sought to reassure participants at the World Economic Forum Annual Meeting in Davos that the world’s second-largest economy will remain an important driving force for global economic growth.
Li declared that China has entered a “new normal” of steady rather than speedy growth. “Despite the volatility in the world economy, China still achieved a GDP increase of over $500 billion [in 2015], which is estimated to be the largest in the world,” he said. China’s GDP grew only 6.9%, but Li said the “medium-high growth rate” is to be expected given the country’s drive to diversify its economic growth drivers.
Consumption, which accounted for 66.4% of the growth, expanded faster than investment, the main growth driver of the past, by 16.7 percentage points. The services sector is now the biggest component of GDP, rising by 2.4 percentage points to 50.5%.
Li said China will continue economic reforms and encourage innovation and entrepreneurship to preserve the momentum. There is encouraging news in the 2.2% growth of the high-tech sector, 30% increase in online retail sales and 42% growth in industrial robots.
“For every single day last year, over 12,000 newly registered companies emerged across China,” said Li, an indication of invigorated entrepreneurship along with the surge in the number of technology and business incubators aimed at young entrepreneurs.
“In the future, the Chinese government will try to make the most of the new round of the scientific, technological and industrial revolution, in other words, the opportunity brought by the Fourth Industrial Revolution,” he added.
China is the chair of the G20 group of developed and emerging countries this year, a grouping that accounts for 80% of the world economy. The G20 summit will be held in Hangzhou under the theme “Towards an Innovative, Invigorated, Interconnected and Inclusive World Economy.”
“The Hangzhou summit will focus its discussions on innovating growth models, improving global economic and financial governance, boosting international trade and investment, and promoting inclusive and interconnected development in an effort to provide new drivers for the development of the world economy,” said Li.