Guest Opinion: A glimpse into China's growth potential

by Yi Xin

Although many in China are familiar with the delightful flavors of Xinjiang's naan, or flatbread, most have yet to try authentic ones from Xinjiang. So when a travel enthusiast and Internet influencer in eastern China, whose online moniker is "TeaFoxWorld," craved the delicacy but couldn't find a local restaurant that offers good choices, he opted to satisfy his culinary cravings by ordering the coveted naan directly from Xinjiang, embracing e-commerce to bridge the geographical gap.

The six naans -- each priced at a modest 3.5 RMB, or yuan, (approximately 0.48 U.S. dollars) -- traveled over 4,000 km from the heart of Xinjiang to the eastern coast, arriving at his doorstep in just three days. The travel enthusiast was not only delighted by the affordable cost of such a hearty and flavorful treat but also astounded by the swift and efficient delivery that spanned such a vast distance. Eager to share his delightful discovery, he took to social media to recount his experience. His post quickly gained traction, and within a matter of days, the online store's stock of naans was completely depleted.

In a related piece of good news for Xinjiang, online buyers in the autonomous region started to enjoy free delivery services months ago, once a privilege reserved for coastal online shoppers due to the distance. More and more courier service-providers are putting the western region onto their free delivery list. The share of goods non-dispatchable to Xinjiang dropped to only 0.83 percent from 10.17 percent in as recent as September 2023. As a result, the number of deliveries to Xinjiang saw a marked rise. The western region's newfound prominence on the free delivery lists is a testament to the growing connectivity and shared prosperity that technology and logistics advancements are enabling. It also offers a glimpse into the country's growth potential.

China's growth potential comes from its extensive and low-cost transportation network. The modern logistics system, bolstered by regional hubs, plays an essential role in efficiently transferring goods to every part of the country, thereby facilitating seamless transactions. In the story of naan, the railroad freight cost for 4,000 km from Xinjiang to the eastern coast is only 0.28 yuan (0.039 U.S. dollars) per kilo. The logistics hub in Xi'an reduces the delivery cost to Xinjiang by 80 percent.

With goods from inland regions more readily accessible to the coastal regions, and vice versa, huge potential of domestic demand is being unleashed, as China continues to upgrade its infrastructure and services in the process of high-quality development.

China's growth potential comes from its huge domestic market. High-quality development ushers in new frontiers of demand, reflecting the evolving aspirations of a better-off society. As living standards rise, people increasingly seek enriched experiences. This trend was vividly illustrated during this year's Labor Day holiday from May 1-5, when approximately 295 million trips were undertaken across the country, bringing in a revenue of over 166 billion yuan (22.59 billion U.S. dollars).

Notably, some lesser-known destinations have captured the imagination of travel enthusiasts. Take Ulanqab in Inner Mongolia for instance, which welcomed more than seven million tourists in the first quarter of this year -- a staggering three-fold increase compared to the same period in the previous year. This surge underscores the untapped potential of China's tourism sector, given the country's vast territory and its rich cultural legacy. As infrastructure and services continue to improve, more hidden gems are set to be discovered, further fueling the growth of domestic tourism.

The application of new technologies also generates new demand. IT-based services like telemedicine, wearable electronics and smart home appliances are really catching on in the country. Green consumption is also growing rapidly. In 2023 for instance, some 9.5 million new energy vehicles were sold in China, taking up 31.6 percent of total car sales and up by 37.9 percent compared with the previous year.

China's growth potential also comes from the investment front. The government's work report for 2024 outlines plans to issue ultra-long-term special treasury bonds, starting from 2024 and extending into the future. By the end of 2024, a sum of one trillion yuan will be allocated through these bonds to bolster key sectors, including sci-tech innovation, urban-rural integration, inter-regional coordination, and food and energy security. The funding will not only drive up short-term investment and consumption, but also secure high-quality development in the long run.

More than 30 million private companies continue to invest in the Chinese market; and the number of family businesses grew by 22.8 percent to 124 million, providing jobs for some 300 million people. Foreign investors increased their holdings of China's bonds by 23 billion U.S. dollars in 2023. According to data from the Chinese Ministry of Commerce, the number of new foreign-invested enterprises in China reached 21,764 from January to May this year, up by 17.4 percent from last year. According to a recent report by Kearney, a consultancy, China's ranking as an attractive destination to invest over the next three years jumped to the third place from the seventh in 2023, continuing to lead emerging markets.

For those keen on investing in China, perhaps the most important thing to watch last week is the third plenum of the 20th Communist Party of China Central Committee. The meeting focused on further deepening reform and expanding high-level opening-up, with a view to promoting high-quality development and advancing Chinese modernization. The goal is to enable the Chinese people to share more of the fruits of economic growth and generate greater impetus to global development.

China's development potential is yet to be fully tapped. Despite persistent predictions of economic collapse, the nation's economy has continued to grow. Now, even with claims that China's growth has plateaued, its trajectory shows no signs of halting. China's growth will generate enormous opportunities. The wise thing to do is to seize these opportunities and prosper together.

Editor's note: Yi Xin is a Beijing-based observer of international affairs.

The views expressed in this article are those of the author and do not necessarily reflect those of Xinhua News Agency.