, May 5 (Reporter Li Jinlei) China's recovery of the good economy is winning more "votes of confidence."

Following the International Monetary Fund (IMF), the United Nations also raised its economic growth forecasts for China. The upward revision has become a vivid footnote for international institutions to remain optimistic about China's economic growth prospects. China's economy, which is constantly improving, will continue to be the main engine of world economic growth.

The United Nations and the International Monetary Fund raised their forecasts for China's economic growth

On May 5, local time, the United Nations released the "16 World Economic Situation and Prospects" mid-year report, which is expected to grow by 2023.2023% in 2, up 3.1 percentage points from the previous report released in January.

For the growth forecast of China's economy, the report was revised up to 4.8% from 5.3% previously, a sharp increase of 0.5 percentage points.

Earlier, the IMF released the latest "Asia-Pacific Economic Outlook" report, which also raised China's economic growth forecast, and it is expected that China's economy is expected to grow by 5.2% this year, continuing to be the engine of economic growth in the Asia-Pacific region and the world.

The report believes that Asia will lead global economic growth, driven by China's economic reopening. China's contribution to global growth is expected to reach 34.9%.

As for the reasons for the upward revision of China's economic growth forecasts, the United Nations and the IMF both mentioned the recovery of Chinese consumption.

The IMF believes that despite weak demand in the rest of the world, a surge in consumption from China is driving growth across the region.

Rashid, head of the UN DESA's Global Economic Monitoring Unit, said China's first quarter retail sales were very strong, exceeding many expectations, retail sales remained strong from the first quarter until now, and the service sector also performed very well, while home sales also rebounded, especially new home sales.

Economic data released by China's National Bureau of Statistics on May 5 showed that in April, the total retail sales of consumer goods were 16,4 billion yuan, an increase of 34910.18% year-on-year, 4.7 percentage points faster than the previous month. From January to April, the sales of commercial housing increased by 8.1%, 4.8 percentage points faster than that from January to March.

Infographic. During the "May Day" holiday, Chinese tourism is hot. Photo by Lu Bo

The recovery of China's consumption has brought positive spillover effects

According to IMF estimates, a 1 percentage point increase in China's gross domestic product (GDP) growth typically drives an average of about 0.3 percentage points for the rest of Asia.

"With the optimization and adjustment of epidemic prevention and control policies, China's consumption vitality has been further highlighted, boosting the rapid recovery of the economy. This recovery will also have positive spillovers to economies in the Asia-Pacific region. Krishna Srinivasan, director of the IMF's Asia and Pacific Department, said that unlike past spillovers mainly caused by investment demand, this spillover will be more reflected in China's increased demand for consumption and services, which is stronger.

Since the beginning of this year, China's consumption has recovered as a whole, especially the rapid release of pent-up service consumption demand in the early stage.

With the increase in residents' shopping, dining, tourism and movie viewing activities, related consumption has expanded significantly. In April, catering revenue was 4.3751 billion yuan, an increase of 43.8%; Operating passenger traffic has increased exponentially, and the box office of movies has also increased significantly.

Since the beginning of this year, the consumption of tourism, shopping, accommodation and catering has been very popular, and the number of tourists and tourism revenue during the "May Day" holiday have exceeded the level of the same period in 2019 compared with comparable caliber.

Xu Hongcai, deputy director of the Economic Policy Committee of the China Policy Science Research Association, pointed out to Zhongxin Finance and Economics that as the impact of the epidemic faded, consumption in April continued the momentum of consumption recovery in the first quarter, coupled with the relatively low consumption base in April last year, the impact of the base effect caused a sharp increase in consumption growth.

Infographic. Photo by Li Jinlei of China News Network

China's inflation rate is lower than in many other major economies

The UN report also shows that the prospects for a strong global economic recovery remain bleak amid high inflation, rising interest rates and heightened uncertainty, and the world economy remains at risk of prolonged low growth.

Rashid believes that China's inflation rate is lower than that of many other major economies and its fiscal foundation is sound, which means that China's monetary and fiscal policies have a lot of room to support economic growth.

Data show that since the beginning of this year, China's CPI year-on-year growth has generally declined, up 4.0% year-on-year in April, down 1.0 percentage points from last month.

"There is no deflation in China at present, and there will be no deflation in the next stage." China's National Bureau of Statistics believes that at present, the low price operation may continue, but in general, it is phased. Internationally, the overall recovery of the world economy is weak, the inflation level of major developed economies is still high, the monetary tightening policy is still continuing, the recent banking crisis in some Western developed countries has gradually emerged, and the global financial stability situation is facing new challenges, which will adversely affect economic development.

The National Development and Reform Commission believes that in the next step, as the effect of the policy of expanding domestic demand continues to appear, consumer demand further recovers, market confidence is enhanced, expectations continue to improve, the base effect is gradually weakened, and the price operation is expected to gradually recover to near the average level of recent years.

The analysis believes that as the economy resumes normal operation, some economic activities that were suppressed in the early stage will be gradually repaired, and the supporting role of the economy will continue to appear, and China's economic operation will continue to recover and improve. (End)