In 2024, China’s economic recovery still appeared sluggish, falling short of the expectations of many observers. However, on the other hand, China remains the world’s largest growth engine from a global perspective.
More importantly, China finally made some long-awaited decisions or witnessed certain shifts in circumstances. While these actions may seem belated, they are by no means too late.
- Timely Adjustments to Economic and Financial Policies
In 2024, China introduced a series of accommodative economic and financial policies, including lowering the reserve requirement ratio, increasing infrastructure investment, and supporting the development of small and medium-sized enterprises.
The stock market quickly rebounded, real estate in major cities stabilized, the manufacturing PMI returned to expansion, and the consumer market gradually recovered.
It remains uncertain whether confidence in the capital markets has been fully restored. However, given that by year-end the government reintroduced the concept of a “moderately loose monetary policy” for the first time in 14 years, 2025 holds promising prospects.
Had these policies been implemented immediately after the pandemic, their effects might have been even greater. Yet the negative consequences of excessive quantitative easing in finance policies in the West have often been described in China using the idiom “drinking poison to quench thirst.”
Considering this, the Communist Party of China’s hesitation is understandable. Fortunately, the shift did not come too late.
- Prudent and Gradual Implementation of Delayed Retirement Policy
Another issue with far-reaching implications is China’s approach to delayed retirement. Many long-time China observers are aware that transitioning a population of 1.4 billion into an aging society poses a colossal challenge.
With birth rates continuing to decline, the so-called demographic dividend is vanishing, and the pressure on the pension system is mounting.
In recent years, delayed retirement has been widely discussed in Chinese society. Although, like people in other countries, most Chinese are not eager to work longer, the implementation of delayed retirement is inevitable.
Thanks to extensive public discussions and the Communist Party’s consideration of diverse opinions, the gradual reforms have been broadly accepted, avoiding the political deadlocks or street protests seen in some developed countries.
The Communist Party could have implemented this reform earlier and more decisively, but the widespread discussions increased public acceptance. This delay, therefore, has its own value.
- Strategic Breakthroughs in Regional Diplomacy
China also witnessed long-awaited shifts in regional diplomatic dynamics.
Amid a complex geopolitical environment, China fundamentally sought to ease relations with Japan, India, and Australia, allowing it to focus on domestic affairs and competition with the United States. However, unlike the first two areas, this required “cooperation” from other countries.
On one hand, the changes of this year are the result of China’s consistent efforts through a mix of soft and hard policies; on the other hand, the election of Donald Trump as U.S. president also played a role. Finally, these countries have noticeably adjusted their stances toward China.
The Sino-Indian border issue was once again effectively managed, Japan’s foreign minister made positive statements toward China, and Sino-Australian relations, after some turbulence, returned to normalcy, benefiting both economies. These diplomatic breakthroughs have created a more favorable regional environment for China.
It would have been better if these changes had happened earlier, but the current outcomes are still quite satisfying.
It is worth mentioning that, on the anniversary of Mao Zedong’s birth in late 2024, China test-flew two new fighter jets, believed to be the world’s first two sixth-generation fighters. This groundbreaking event placed China ahead of the West in advanced fighter technology.
On the same day, AI company DeepSeek officially launched the first version of its new model series, DeepSeek-V3, and simultaneously made it open source. Among open-source models, its test performance ranked first, matching closed-source large models in many aspects, and its computational cost is reportedly “only 1/100 of GPT-4.”
Had these achievements emerged earlier, they might have prompted the United States to more seriously consider how to engage in equal dialogue and “healthy competition” with China.
But even now, it’s not too late—especially before the new U.S. president takes office. Perhaps he will understand.
