The International Monetary Fund has released an update to its World Economic Outlook, predicting that China's economic growth will be 5 percent in 2024. That is 0.4 percentage points higher than its forecast in April. It also slightly lowered its expectations for the economic growth in the United States and Japan. IMF economists believe that China and India will account for nearly half of the global economic growth this year.

The report warned that the slower-than-expected cooling of inflation in developed economies may force central banks, including the Federal Reserve, to maintain higher borrowing costs for a longer period of time, which will put overall growth at risk, with emerging and developing economies suffering adverse spillover effects.

In addition, the IMF specifically mentioned that the US, under full employment, continues to maintain a fiscal stance that is steadily pushing up its debt ratio, and its deepening reliance on short-term financing is creating risks for the world economy as a whole.

The IMF, as well as other international institutions such as Morgan Stanley, Goldman Sachs and UBS, all raised their forecast for China's economic growth this year, mainly because of the overall performance of the Chinese economy in the first half of the year and the effectiveness it has displayed in preventing and resolving risks.

The Chinese government has always been able to come up with appropriate policies to handle the relationship between promoting transformation and stable growth. By implementing various measures the risks in key areas such as real estate, local government debt, and small and medium-sized financial institutions have been further reduced. China achieved its growth target in the first half of the year, indicating that the Chinese economy has the ability to digest the challenges of its transition from old to new drivers of growth.

At the same time, it has continued to promote the process of structural optimization and continuously enhanced the quality of its development, while adopting a series of policies to expand domestic demand. Since March, China's policies to expand domestic demand have mainly focused on consumption and manufacturing investment, encouraging equipment renewal and the trade-in of consumer goods to cultivate new growth points for consumption. In addition, the ultra-long special treasury bonds issued by the Ministry of Finance have been and will be invested in the construction of scientific and technological innovation, urban-rural integration, regional coordinated development, food and energy security, and high-quality population development.

At present, new policies to expand domestic demand are being formulated to ensure that they play a positive role in stabilizing growth, promoting transformation and adjusting the country's economic structure. High-tech manufacturing investment and exports have grown rapidly, and the trend of high-end, intelligent and green manufacturing has been obvious, which continues to enhance the global competitiveness of the country's manufacturing industry.

However, in the second half of the year, the Chinese economy may still face some external factors, namely the fluctuations in the global financial system caused by the shift in the Federal Reserve's monetary policy and the uncertainty caused by the US election in related economic fields. So, the country must be prepared to stabilize and expand domestic demand and respond to various external risks and shock waves.

21ST CENTURY BUSINESS HERALD