China now knows that if it continues to grow, it has to do it internally, which means a shift that hasn’t happened yet, forcing consumers to spend excess savings, which it is doing at a very slow pace.
China’s economy will recalibrate due to the disruption to the global order, and the new driving force behind growth will “disappoint” global markets.
At the National People’s Congress on Sunday, China’s government announced a gross domestic product growth target of around 5% in 2023, the country’s lowest rate in more than three decades and below the expected 5.5%. by economists. The administration proposed an increase in financial support for the economy, raising the estimated budget deficit rate from 2.7% in 2022 to 4% in the current year.
China’s growth prospects are threatened by the US and other countries
The president and other officials have taken aim at the West for limiting China’s growth prospects as tensions between Beijing and Washington deteriorate.
The external environment will challenge China as the US and other high-income countries align their technology investments and trade policies with growing geopolitical and security considerations.
The United States will try to curb its global influence by widening the “technology gap,” which it expects to widen from 5 to 10 years to about 20 years. To do this, Washington can use its power to monopolize trade with countries in innovative technological areas that can serve both missiles and mobile phones, for example, the industry in the Netherlands.
The implementation of additional regulations by Western countries, including restrictions on investment in China, denial of access to technology, limited market entry for Chinese companies, and the spread of various diversification approaches, may have negative effects. lasting in the risk considerations of outside investors when doing business in China. Porcelain.
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