Page 22 - CCFA Journal - Ninth Issue

协会论坛 CCFA Forum 加中金融

CCFA Distinguished Speaker Series

A Short to Medium-Term Outlook on China’s Economy

Reporter and Translator: Wei He, Sarah Li

On October 3rd, 2022, the Canadian Chinese Finance Association (CCFA) was honored to host Dr. Daniel Koldyk, Counsellor of
Economics and Finance at the Embassy of Canada to China, in Toronto to share his view on China’s economic outlook in the short-
to-medium term.

The event was CCFA’s second in-person event since the pandemic, where a sold-out crowd of academics and business professionals
enjoyed a 45-minute presentation followed by Q&A and networking.

Daju Gu, president of CCFA, extended a warm welcome to the speaker, identifying the critical juncture that China is facing today
and how a thorough understanding of its dynamics is necessary for shaping the future for Canada-China bilateral relations, and its
effects on the world economy.

Dr. Koldyk started the speech with a holistic review of China’s key economic indicators since the 2020 pandemic. While the service
sectors，notably hotel, traveling and catering，bore the brunt of the zero-COVID shutdown, other industries largely fared well with
major rebounds in manufacturing and foreign trade. Dr. Koldyk concluded that despite the setbacks, the fundamentals of the
Chinese economy have managed to hold up.

Looking into year-end and 2023, Dr. Koldyk suggested that the Chinese economy would likely pick up if Beijing were to phase out
its strict zero-COVID policy. For example, consumption is set to enjoy a huge boon, while tech regulation and tax cuts should give a
boost to the private sector. Real estate, albeit severely hurt, is likely to stabilize with government bailout funds in place. SOE
investment will continue unperturbed.

In the medium run, structural reforms are urgently needed for China’s economy to transform from an investment-led growth to a
consumption and innovation driven one. Dr. Koldyk identified new levers to spur growth, including increasing consumption,
prolonging employment, supporting homegrown innovation, etc. Each
of these measures requires in-depth structural reforms that cannot be
achieved overnight.

In the following Q&A session, Dr. Koldyk addressed issues ranging from
local government debt, multinational corporations’ investment in
China, to zero-COVID policy and foreign exchange rates. He pointed out
three major factors that foreign businesses should watch out for in
China: macroeconomic sentiments, zero-COVID policy, and geopolitical
tensions.

He ended the session by projecting an optimistic scenario of China’s
economy, where innovation, dual circulation, common prosperity, and
sustainability materialize as the key themes for development.

CCFA JOURNAL OF FINANCE December 2022
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