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嘉博国际手机版下载客户端: Epidemic impact on China to be limited

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2020-02-12 08:26:35China Daily Editor : Li Yan ECNS App Download
Special: Battle Against Novel Coronavirus
本文来源:http://www.344218.com/www_dygang_com/

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A port employee directs a cargo vessel from South America during its docking process in Qingdao, Shandong province, last week. (Photo by Zhang Jingang/For China Daily)

Global firms: Consumption slowdown to be offset by strong fundamentals

The impact of the novel coronavirus epidemic on China's economy will be temporary and will not change the fundamentals of the country's long-term economic growth, said executives of global companies on Tuesday.

"We are confident that China will not only overcome the difficulties and win the anti-epidemic battle, but have the ability to minimize the impact of the epidemic on the economy," said Wang Renrong, executive director of Budweiser Brewing Co (APAC).

The slowdown in the consumption sector should not cause alarm, said Wang, stressing it has been widely agreed that the Chinese economy has done well in shifting from high-speed development to quality growth.

Many business units of the Belgian company resumed work on Monday under a flexible work arrangement, to maintain routine operations.

Since China has amounted several measures to mitigate the impact of coronavirus outbreak on its economy, including financial support from banks and cuts in taxes and rents, Philips (China) is encouraged by these measures, and will mobilize its local and global resources to ensure its manufacturing operation and innovative activities. said Andy Ho, CEO of company.

China's tax authorities published a document on Tuesday containing a set of policies to ease tax burden for individuals and corporates during the novel coronavirus outbreak, including exemptions of individual income tax and value-added tax for certain taxpayers.

Companies that provide key supplies for controlling the epidemic, will receive full refund of the tax credits of the incremental value-added taxes. The VAT on income from the transportation and express delivery of the epidemic control supplies will be canceled, according to the document.

"Based on the experience from the SARS crisis in 2002-03, we can foresee a quick rebound of the Chinese economy in terms of recovery of inventory, restocking demand, uplift of consumption of goods and services after the freeze," said Denis Depoux, managing director for China of global consultancy Roland Berger.

The economic growth will also get strong fiscal and monetary support from the government; and local infrastructure investment, financed by special bonds, as in 2019, will support the economy, he said.

More foreign businesses have resumed production as scheduled and others are asking employees to work from home. Factories owned by Tesla Inc, Cargill Inc, Samsung Electronics Co and SK Hynix all resumed production across China on Monday.

The government will prioritize demand for product of foreign-funded enterprises that produce protective goods and equipment such as medical protective clothing, facial masks and goggles, to promptly resume production and meet the market demand, as well as help them gain necessary protective materials, said a circular unveiled by the Ministry of Commerce on Monday.

Even though the services sector, in particular tourism, catering, transport and retail segments, bears the brunt this time, Wang Tao, chief China economist at Swiss bank UBS, said the company expects fiscal policy to provide tax relief for affected businesses, especially small-and medium-sized enterprises, targeted support for affected households and areas, and additional boost to infrastructure investment.

"As the coronavirus is a one-off negative shock, we expect China's GDP growth to rebound to 6 percent in 2021 as activities normalize," said Wang, adding China's long-term trend of moving toward a more consumption-oriented economy, of rising services share in the overall economy, and of technological upgrade will continue.

Liu Yuanchun, vice-president of the Renmin University of China, said capital, labor and technology advances are known as the key determinants of an economy's long-term development. The epidemic will not cause fundamental changes in how capital and human capital accumulate in China, and will make people attach greater attention to technological advances.

In the short term, the strong resilience of the economy will help it to defend itself against any disruptions caused by the epidemic, Liu said, citing China's institutional advantage in concentrating its resources to accomplish major tasks, strong production ability, vast domestic market and rich policy tool kit.

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