China's economy grew 4.8 percent year on year in the first quarter, exceeding market expectations and picking up pace from a 4-percent increase in the fourth quarter last year.
That is good news as a volatile global situation and multiple sporadic COVID-19 outbreaks at home since the beginning of this year have somewhat dampened the confidence in the world's second-largest economy. It is, therefore, good timing to keep in mind that there remain significant upsides to the Chinese economy.
In the first quarter, as the biggest force behind the economic expansion, final consumption expenditure growth accounted for 69.4 percent of the overall GDP expansion. Sales of new energy vehicles and intelligent home appliances rose significantly.
On top of its continued recovery, China has adopted a range of pro-consumption policies. The trend of new patterns and models, such as the in-depth integration of online and offline sales and more high-end sales in the rural market, bodes well for future consumption.
One primary feature of the Chinese government's economic policies has been boosting investment in infrastructure this year. In the first quarter, infrastructure investment rose 8.5 percent year on year. China has promised a moderately proactive approach to advance infrastructure investment aligned with the country's major strategic deployment and the 14th Five-Year Plan.
There are signs that industrial upgrades are gathering momentum. In the first quarter, the value-added output of the high-tech manufacturing industry increased by 14.2 percent year on year, and that of equipment manufacturing industry grew by 8.1 percent.
China's green and intelligent transformation is also bearing fruit. In the first quarter, the production of new energy vehicles and solar cells increased by 140.8 percent and 24.3 percent year on year, respectively. The rapid development of the 5G network, information technology and artificial intelligence technology has accelerated, giving rise to new frontiers in new industrial growth.
China's increased opening up to the outside world continues to pay dividends. In the first quarter, its total imports and exports expanded by 10.7 percent year on year, a huge achievement over the previous year's high base. That reflects the resilience of China's foreign trade. Despite the complex and severe international environment, the world economy is generally recovering, so the demand for China's exports will increase.
In the face of the complex situation, various regions and departments in China have put forward comprehensive policies to stabilize the economy and increase support for the real economy. The Chinese government has promised more transparency and predictability in policy-making, on top of expanding pro-growth policies. Overall, China has sent clear signals of stabilizing economic growth while effectively containing the spread of COVID-19, a cause for further optimism.