Speaking to ANZ Chief Economist Richard Yetsenga as part of the Blue Lens on Mic podcast series, Zhang - the Xinyuan Chair Professor of Finance and Associate Dean at PBC School of Finance, Tsinghua University, said solving China’s post-COVID shock would take time.
“It's not [like China is] losing dynamics, it's just adjusting [it's] growth stage and the changing environment in the whole world,” she said.
The conversation also featured Winston Zhao, former Senior Vice President and General Counsel of YMTC, a Chinese semi-conductor manufacturer. Both Zhao and Zhang are ANZ China board members. You can listen to an edited version of the discussion below.
Zhang is optimistic on China's outlook, and likened the country’s slowing growth rate to a “natural lifecycle”, and of a person coming of age. Yestenga agreed.
“In fact, the historical evidence suggests countries become wealthy not by growing quickly, but actually by growing consistently,” he said. This helps them avoid “some of the crises which set so many emerging markets back”.
“And China, of course, has done a very good job of that,” he said.
Zhao acknowledged China had entered into a new stage of development but backed the country to make the transition.
“I think by focussing on quality rather than quantity, and also sustainability, rather than a high GDP - all of this demonstrates China… [needs] to explore its own way.”
Zhang said China has many levers to pull in addressing the transition.
“Some of the solutions are short term,” she said. “Some of solutions are long term."
“That’s why the whole economy, the whole country - the public sector, the private sector - over the last year has been making a lot of adjustments.
“Which bring more challenges and more promise. And, of course, uncertainties.”
Zhao said China was not alone in it its attempt to maintain the quality of its growth, but admits that will be difficult.
“In terms of dynamics, my sense is China does face some challenges,” he said. “You read about all these layoffs as a result of the reforms. And there are a lot of concerns about property companies.
“People become very concerned about the potential impact on China's economy as a whole.”
The wide-ranging conversation also touched on life in China amid COVID, the changing shape of China’s innovation, and demographics in the growing nation. Listen to the podcast above to learn more.
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