Global Integration Steams Ahead

Nov 23-2021   

The pandemic has fanned the fears that globalization is decelerating and value chains worldwide are breaking down. Such things are not happening, says Prof. Yao Yang, Dean of the NSD in a recent forum.

In fact, globalization is still gaining steam, and both the Chinese and world economies have demonstrated remarkable resilience in the face of multiple challenges, according to Prof. Yao. Due to industrial division, a country tends to focus on specific parts of value chains, the aggregate consequence of which is that 90% of global trade comprises intermediate goods rather than consumer products.

Since the outbreak of the pandemic, China has seen the proportion of its economy and trade in the world total growing substantially, a testament to its ever-deeper integration into the global fabric. Official figures show that China’s total trade reached 28.33 trillion yuan in the first three quarters of the year, a 22.7% increase year on year.

Prof. Yao also points out that enormity of its market size and production networks has made the Chinese economy resilient and at the same time attractive to foreign investors. Most foreign-invested companies are putting up more investments in China to take advantage of huge market demand. Tesla, for example, is posting monthly sale of over 50,000 cars only a year after its factory in Shanghai became operational.