China’s Growing Economy Benefits Others
Over this period, online retail sales have risen 16.8 percent year-on-year, amounting to RMB 7.32 trillion. The country witnessed a surge in sales of cost-effective, smart, and culture-inspired goods, as well as those with personalized designs. Smart stores and immersive in-store experience are gaining popularity among consumers, while travelers are now more willing to pay for quality services.
At the same time, cross-border e-commerce gave a boost to China’s foreign trade. Sales of imports via online platforms jumped more than 30 percent year-on-year. The integration with social media platforms fuels the diversification of the e-commerce market, unleashing consumption potential, particularly in small and medium-sized cities and rural areas, and this in turn has become an important factor in boosting domestic demand.
In this market that is fostered by both Chinese and foreign investors, private Chinese businesses have been given more opportunities to invest in nationally significant areas of the manufacturing sector and Internet industry, including telecommunications and competitive services. The purchasing managers’ indexes of advanced manufacturing, equipment manufacturing, and consumer goods exceed the average level of the manufacturing sector as a whole. Many companies translated dividends brought by tax cuts and administrative charge slashes into strength in research and development, improving the product quality to better satisfy the demands of clients.
Starting from April 1 this year, China began a policy enabling eligible enterprises to receive refunds for their payments of input value-added taxes (VAT) yet to be deducted. This advances the government’s commitment to cut taxes after alleviating the taxation burdens of micro and small enterprises and deepens the VAT reform.
According to “Doing Business 2020,” a recent report released by the World Bank, China climbed from the 46th place to 31st in the global ranking on the ease of doing business and was rated one of the 10 economies with the most notable improvements in business climate. In regard to the indicator of paying taxes set by the report, China’s ranking continued a rising trend and went up nine places in 2019. The improvements can be attributed to China’s implementing a preferential corporate income tax rate for small enterprises, reducing the VAT rate for certain industries and enhancing the electronic filing and payment system, the report explained.
At the same time, China will implement a new regulation to foster a stable, fair, transparent, and predicable business environment on January 1, 2020. It is a move of institutional improvement as the Chinese government minimizes its direct involvement in the allocation of market resources by aligning itself with leading international practices.
The increasingly improving business climate in China is attracting more investors, both Chinese and foreign, to the domestic market to achieve bigger returns. Technological progress provides better infrastructure for them in this pursuit.
In 2019, 5G commercial services were officially launched in China. A total of 130,000 5G base stations are expected to be activated nationwide this year with the services available in 50 cities that will be further expanded to more than 340 ones next year. The commercialization of 5G technology will spawn more applications driven by data resources, giving a push to the integration and development of relevant technologies like the new generation of artificial intelligence, cloud computing, and block chain. The 5G service packages for personal communication were also launched on November 1.
The ancient classic of The Analects of Confucius highlights traditional Chinese wisdom that when people thrive, they will bring prosperity to others. After growing its own economy, China is committed to creating benefits for the world.
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