In 2020, the global economy was hit hard by the new crown epidemic.

However, as the new crown vaccine research and development progress, people have optimistic expectations for global growth.

Although there is still uncertainty about the speed of global vaccine launches, social distancing restrictions are expected to continue to relax in 2021, so global economic activity will inevitably rebound.

Even countries that have been slow to launch vaccines will benefit from the spillover effects brought about by the recovery of other economies.

　　China has already recovered from the economic downturn triggered by the epidemic in the first quarter of 2020, and will steadily enter 2021.

With the rebound in consumption and corporate investment, China's growth situation is expected to be further consolidated in 2021.

　　For most of 2020, growth in the industrial and investment sectors has driven the recovery, while consumption is gaining momentum towards the end of the year.

In 2021, driven by factors such as employment growth and the reduction of the epidemic, consumption momentum may become stronger.

With the improvement of confidence, profitability and global economic prospects, coupled with the reduction of geopolitical risks, we expect that corporate investment, which accounts for about half of the total investment, will recover.

"New infrastructure" fields such as 5G, new energy, electric vehicles, and data centers may see substantial growth, most of which are reflected in corporate investment.

　　China’s export prospects are improving. The forward-looking indicators of global trade and the new export orders in the China Manufacturing Purchasing Managers’ Index all indicate a better export demand.

However, many one-off purchases related to the epidemic will not recur in 2021.

In addition, the supply of vaccines will reduce the need to maintain social distancing, so global consumption from goods to services may change.

　　Overall, China’s imports should continue to grow substantially.

We expect that capital goods exporters from countries such as Germany and Japan will benefit from this.

　　China's economic recovery will be further consolidated in the first half of next year, and GDP in the first quarter is expected to grow by about 19% year-on-year.

In addition, the "14th Five-Year Plan" is dedicated to promoting higher-quality growth.

We expect GDP growth in 2021 to be stable month-on-month. In the second half of the year, the month-on-month growth will increase due to the improvement of global economic growth and the adjustment of some policy positions.

　　China's balance of payments may remain relatively stable.

Based on import and export trends, we expect the current account surplus to decrease in 2021.

However, in view of China's solid growth prospects, higher interest rates than most developed countries, and further opening of the financial market, it is expected that its foreign direct investment and securities investment will gain momentum next year.

　　Foreign companies want to continue operating in China

　　The new US administration may implement a more pragmatic and stable policy toward China.

The offensive and unpredictable policies implemented by the current US government have put pressure on investment and economic activities, and the new China policy may have a positive impact.

In addition, more dialogue and cooperation on "global common interests" such as climate change and public health should help ease bilateral tensions and risks.

　　In any case, governments and companies from all over the world maintain a keen interest in continuing to engage with China.

China's manufacturing industry still has strong competitiveness in many fields, and the Chinese market is still attractive to foreign companies, so serious "decoupling" will not occur.

　　Difficult external conditions have prompted China to adjust its long-term development strategy.

China is committed to implementing a "double cycle" and emphasizes technological self-reliance and self-reliance.

Therefore, in the next few years, China is expected to invest more in research and development and increase investment in high-tech fields, especially in semiconductor and high-end manufacturing fields.

　　(The author is Gao Luyi, Director of Asian Economic Research, Oxford Economics Institute, UK)