China’s economy has suffered a plunge in the first half of 2022. But put into context, given its economic size, even a 5 per cent expansion of its economy is nearly equal to creating an economy the size of the Netherlands’, or one larger than Turkey’s. A slower growth rate on such a gigantic economic scale is inevitable.
While gloom abounds, China’s economic engine has hit a kerb, not a dead end, and there is still ample room to engineer an economic turnaround.
In the latest 10,000-participant economic rescue meeting presided by Premier Li Keqiang, he cautioned that “the current economic condition, at some levels, is worse than in early 2020 when Covid-19 freshly hit”.
China faces export decline and consumption fragility in 2022, exacerbated by the ongoing zero-Covid policy. Manufacturing capacity has mainly been disrupted under lockdowns, and consumption growth has nearly been stagnant, with millions of Chinese stuck at home.
But Mr Li also noted that China did not flood the market with liquidity during the pandemic, and as a result has escaped the inflation curse engulfing the West. China’s April consumer price index, a measure of the price of consumer goods and a marker of inflation, rose a mild 2.1 per cent and the Chinese Central Bank has enough policy space to lower interest rates if the economy commands it.
Trade, consumption and investment are commonly named the “three horse carriages of the Chinese economy”. It is unsurprising that China’s imminent economic rescue measures will centre on the third and last horse of the economy. In the meeting, Mr Li committed to an old-school Keynesian policy prescription: major investment in the country’s infrastructure.
In the more than 40 years since China began its reforms, its economy has hit speed bumps a few times, including in 1990, in 1998 following the Asian Financial Crisis and the Global Financial Crisis of 2008. Each time, China faced enormous domestic economic challenges. And each time, China fostered new growth impetus to the economy.
In the more than 40 years since China began its reforms, its economy has hit speed bumps, and each time, it fostered new growth
In the first two decades of the 21st century, investing in rural transportation, highways, high-speed rail and airports has been a sturdy pillar of China’s economic growth, particularly at difficult moments. This time is no different.
However, China faces a new dilemma in 2022. The challenge for China today is less whether it should invest in infrastructure but what infrastructure it should invest in that will best deliver the economic outcome needed for tomorrow. Not all types of infrastructure are equal when measured by growth potential.
But today, China’s economic challenges go beyond simple structural reasons. It faces two formidable economic risks in 2022: the side effects of the persistent zero-Covid policy and the tightened control of the private sector over the past year. Two sectors stand out as the primary casualties.
The real estate sector produces a fifth of China’s GDP. Real estate feeds into a large spectrum of industries, from raw materials, construction and banking to real estate services. The real estate sector has been suffering from the government policy claw-back from land sales and bank credits to imposed sales price caps and floors.
Since the surprising measures taken against China’s ride-hailing app Didi one day after its debut on the New York Stock Exchange, the country's most savvy entrepreneurs have responded swiftly by relocating stock offerings to Hong Kong and focusing on their core businesses. The antitrust regulations imposed on Chinese technology companies have caused layoffs among China’s nouveau tech elite class, who have grown comfortable living off of lucrative stock options. Over $1 trillion worth of market cap from big Chinese tech firms has dissipated at both the US and Hong Kong stock exchanges since then.
So what next? The solution to China's growth clearly lies in the technology realm – but think infrastructure, not unicorns. NDRC, the national economic planning body, has outlined an ambitious data and computing power national roadmap for the 2020s. The plan aims to transfer the wealth of data stored on servers on China’s east coast to the newly conceived data computing centres in the western part of the country. China’s west has thus far lagged in its development momentum; this move will not only tap into the rich renewable energy capacity there, but also give the region a unique unequivocal strength in the digital era.
China is clearly focusing on renewable energy infrastructure, budgeting nearly $10tn to expand capacity – a bold move that will fast track the renewable energy innovation cycle, reduce the cost and cement an inalienable centrality to the global supply chain for the energy transition. Over the coming decades, China will likely be the world’s largest electric vehicle producer, with a robust national EV infrastructure outlay. It currently holds the most significant global share in solar and wind energy supply chains.
By contrast, the American Build Back Better Act that would see the delivery of renewable energy infrastructure, including 50,000 charging stations across the US, was voted down by the Senate. While both China and the US realise the significance of investing in renewable energy infrastructure, China’s economic slowdown has provided the incentives to expand its own infrastructure massively while the US lags behind.
Within the decade, China will see its cloud computing capability significantly upgraded and its renewable energy market more affordable and accessible. A new economic model will emerge out of this crisis, making the current slowdown, ironically, worthwhile.
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Where to donate in the UAE
The Emirates Charity Portal
You can donate to several registered charities through a “donation catalogue”. The use of the donation is quite specific, such as buying a fan for a poor family in Niger for Dh130.
The General Authority of Islamic Affairs & Endowments
The site has an e-donation service accepting debit card, credit card or e-Dirham, an electronic payment tool developed by the Ministry of Finance and First Abu Dhabi Bank.
Al Noor Special Needs Centre
You can donate online or order Smiles n’ Stuff products handcrafted by Al Noor students. The centre publishes a wish list of extras needed, starting at Dh500.
Beit Al Khair Society
Beit Al Khair Society has the motto “From – and to – the UAE,” with donations going towards the neediest in the country. Its website has a list of physical donation sites, but people can also contribute money by SMS, bank transfer and through the hotline 800-22554.
Dar Al Ber Society
Dar Al Ber Society, which has charity projects in 39 countries, accept cash payments, money transfers or SMS donations. Its donation hotline is 800-79.
Dubai Cares
Dubai Cares provides several options for individuals and companies to donate, including online, through banks, at retail outlets, via phone and by purchasing Dubai Cares branded merchandise. It is currently running a campaign called Bookings 2030, which allows people to help change the future of six underprivileged children and young people.
Emirates Airline Foundation
Those who travel on Emirates have undoubtedly seen the little donation envelopes in the seat pockets. But the foundation also accepts donations online and in the form of Skywards Miles. Donated miles are used to sponsor travel for doctors, surgeons, engineers and other professionals volunteering on humanitarian missions around the world.
Emirates Red Crescent
On the Emirates Red Crescent website you can choose between 35 different purposes for your donation, such as providing food for fasters, supporting debtors and contributing to a refugee women fund. It also has a list of bank accounts for each donation type.
Gulf for Good
Gulf for Good raises funds for partner charity projects through challenges, like climbing Kilimanjaro and cycling through Thailand. This year’s projects are in partnership with Street Child Nepal, Larchfield Kids, the Foundation for African Empowerment and SOS Children's Villages. Since 2001, the organisation has raised more than $3.5 million (Dh12.8m) in support of over 50 children’s charities.
Noor Dubai Foundation
Sheikh Mohammed bin Rashid Al Maktoum launched the Noor Dubai Foundation a decade ago with the aim of eliminating all forms of preventable blindness globally. You can donate Dh50 to support mobile eye camps by texting the word “Noor” to 4565 (Etisalat) or 4849 (du).
Greatest Royal Rumble match listing
50-man Royal Rumble - names entered so far include Braun Strowman, Daniel Bryan, Kurt Angle, Big Show, Kane, Chris Jericho, The New Day and Elias
Universal Championship Brock Lesnar (champion) v Roman Reigns in a steel cage match
WWE World Heavyweight ChampionshipAJ Styles (champion) v Shinsuke Nakamura
Intercontinental Championship Seth Rollins (champion) v The Miz v Finn Balor v Samoa Joe
United States Championship Jeff Hardy (champion) v Jinder Mahal
SmackDown Tag Team Championship The Bludgeon Brothers (champions) v The Usos
Raw Tag Team Championship (currently vacant) Cesaro and Sheamus v Matt Hardy and Bray Wyatt
Casket match The Undertaker v Rusev
Singles match John Cena v Triple H
Cruiserweight Championship Cedric Alexander v Kalisto
Who has been sanctioned?
Daniella Weiss and Nachala
Described as 'the grandmother of the settler movement', she has encouraged the expansion of settlements for decades. The 79 year old leads radical settler movement Nachala, whose aim is for Israel to annex Gaza and the occupied West Bank, where it helps settlers built outposts.
Harel Libi & Libi Construction and Infrastructure
Libi has been involved in threatening and perpetuating acts of aggression and violence against Palestinians. His firm has provided logistical and financial support for the establishment of illegal outposts.
Zohar Sabah
Runs a settler outpost named Zohar’s Farm and has previously faced charges of violence against Palestinians. He was indicted by Israel’s State Attorney’s Office in September for allegedly participating in a violent attack against Palestinians and activists in the West Bank village of Muarrajat.
Coco’s Farm and Neria’s Farm
These are illegal outposts in the West Bank, which are at the vanguard of the settler movement. According to the UK, they are associated with people who have been involved in enabling, inciting, promoting or providing support for activities that amount to “serious abuse”.
White hydrogen: Naturally occurring hydrogen
Chromite: Hard, metallic mineral containing iron oxide and chromium oxide
Ultramafic rocks: Dark-coloured rocks rich in magnesium or iron with very low silica content
Ophiolite: A section of the earth’s crust, which is oceanic in nature that has since been uplifted and exposed on land
Olivine: A commonly occurring magnesium iron silicate mineral that derives its name for its olive-green yellow-green colour
New UK refugee system
- A new “core protection” for refugees moving from permanent to a more basic, temporary protection
- Shortened leave to remain - refugees will receive 30 months instead of five years
- A longer path to settlement with no indefinite settled status until a refugee has spent 20 years in Britain
- To encourage refugees to integrate the government will encourage them to out of the core protection route wherever possible.
- Under core protection there will be no automatic right to family reunion
- Refugees will have a reduced right to public funds
The Vile
Starring: Bdoor Mohammad, Jasem Alkharraz, Iman Tarik, Sarah Taibah
Director: Majid Al Ansari
Rating: 4/5
