The numbers of China’s economic growth in the first quarter of 2021 are huge, a record rebound we talk about it with the economist Michele Geraci professor of finance and international trade as well as former Undersecretary to the Ministry of Economic Development in the first Conte government, welcome back to Rai News 24.
PLEASE NOTE
This text is a translated transcription of the original Italian video available on my YouTube channel.
Good morning, good afternoon to you.
Journalist: So professor, which China seems to be leaving behind the pandemic and the crisis due to the pandemic, what strategy for the recovery has Beijing used?
Theirs, after their initial delays in January of 2020 understood that we say fighting the virus and saving the economy were not two conflicting goals as we perhaps think. So they did an iron-clad two-and-a-half-month lockdown and basically shut down the entire province of Hubei and also most of the rest of China and then pretty much a year ago almost a day today at the end of April, they left.
I have been living here for more than six months life has returned to absolute normality, there is a great use of the apps this is something that we still may not have accepted and I tell you what I was Wuhan already six months ago, there is the museum of the virus as if to say it is something that in the collective imagination is a problem already overcome and this was due to that strategy that they obviously had the strength, the Chinese government to impose a lockdown, a quarantine not trustworthy but tight enough, borders have been practically blocked so now when there are those few outbreaks, which still happen but there are very few cases, They basically do and they go down very heavy to try to limit the contagion and as I say when the economy has broken down since April it is clear that we have now had this performance of GDP that has done over 18 percent. That is equivalent, to make the numbers as if Italy grew by 34, they have resumed practically as if the crisis had never existed in China, a growth of about 5 percent per year in 2020 and in this first quarter of 2021.
Journalist: what were the commitments of the Chinese government for small and medium-sized enterprises on the one hand and then for the tech giants on the other?
But then, unlike us where we talk about refreshments, aid, it must be said that the Chinese government did not give so much support to small businesses in that period, because, of course, when the economy grows by 6%, even if they have lost GDP points in 2020 and have grown by almost 2.5%, they have nevertheless considered that this was enough to give an outlet anyway a survival to companies, without the need to go and support them.
For large technology companies we obviously had cases with the speech of Alibaba, the Chinese system works in this way small and medium-sized enterprises are like saying encouraged and encouraged to proliferate, Private property is obviously encouraged by the government, but no one should enter into the sphere of what is the hegemony we say of the State. So the line between state and market is very clear and you are free to operate within the rules of the market without going to hit the system, so the big Internet giants who also pay attention to us begin to replace the moral judgments of the government, It’s obviously not allowed here in China.
Journalist: however, geopolitical tensions remain, especially with the United States, even with Europe could these, in some way influence the stability of the Chinese recovery?
But no look, I think not because China already has how to say, anticipated this problem already they for ten years have greatly reduced their exposure to export. I remember in 2010 the ratio between export and GDP was about a third, a bit like that of Italy today and their in these ten years have managed to reduce this dependency now export counts for only 18 percent of GDP while Italy even continues to grow, So we are in this situation, very different and Italy continues to have a GDP that depends on external demand and therefore subject to external shocks, we must worry. While China has anticipated and is a bit like saying sheltered from these possible external shocks and so I believe that any tensions certain, there will be industry sectors that will be affected, but systemically, China, which has already made a deal with 14 other Asian countries for a free-trade area that accounts for 30% of GDP, which is growing, we say that it may not do without it, but in any case the shocks will be well absorbed by them, because they have this so-called statist economy that has the ability and speed to react immediately if there are problems, as there will be, but they almost always manage to solve them.
Journalist: Professor we are closing one last question, she referred a little bit to the whole Asian area, is departing for the annual conference of the Asian Davos, What are the main themes of international politics and the international economy?
Tomorrow the forum begins in Bo’ao on the island of Hainan, the main topics are: digital, precisely support for small and medium-sized enterprises and a lot about the green economy that is obviously what China is trying to push, this is good news because I believe that when the big blocs Europe, the United States and China talk about issues that are of common interest, that is, the environment and we find, say, tables on which we can debate without the tensions of the past, so I hope and will keep you updated if you are interested in the next three days we will talk a lot about these issues, which are of interest to you obviously for China, but also of global interest.
Journalist: thank you, thank you Professor Michele Geraci for being with have deepened these issues.