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China’s Economic Growth Potential Continues to Expand with New High-Tech Projects Underway

BusinessChina's Economic Growth Potential Continues to Expand with New High-Tech Projects Underway

Dozens of mechanical arms move along a production line while busy robots carrying components weave about in a science and technology park in North China’s Tianjin municipality. The scene is the opposite of what it was three years ago when production of the line was intermittently suspended in the Tianjin Lishen Battery Joint-Stock Co Ltd factory due to order shortages. Nowadays, more than 2,000 sets of power batteries are produced each day, which are used for nearly 200 electric vehicles.

Lishen started providing power batteries for the Dongfeng Motor Corp four years ago, delivering about 53,000 sets by the end of last year. In 2023, however, it is estimated that 45,000 sets will be supplied. “We didn’t stop working even during the Spring Festival holiday,” said Zhao Xiaojun, deputy head of Lishen’s power battery manufacturing department. “Now that we are no longer worried about order shortages, we fear that we can’t complete the orders on time.”

This is just one of many examples that illustrate the resilience of the Chinese economy since the country relaxed its COVID-19 restrictions late last year. According to statistics by the China Association of Automobile Manufacturers, in 2022, output and sales of new energy vehicles in China were 7.06 million and 6.89 million units, up 96.9 percent and 93.4 percent, respectively.

The International Monetary Fund (IMF) has raised its forecast for China’s economic growth this year to 5.2 percent from a previous prediction of 4.4 percent. Suppliers for Lishen are mostly domestic companies. Last May, when consignments were hindered by the COVID-19 pandemic, local authorities in Tianjin helped to arrange for closed-loop delivery to ensure production in Lishen. “If we stop our production, the loss per day would be as much as 30 million yuan ($4.32 million),” said Zhao.

In 2022, despite the pandemic, the revenue of power batteries in Lishen soared by 76 percent. According to China’s State Council Information Office, last year’s investment in high-tech industries witnessed rapid growth, up 18.9 percent from the previous year. The growth rate for high-tech manufacturing was 22.2 percent and the rate for high-tech services was 12.1 percent.

Another Tianjin-based company, TCL Zhonghuan Semiconductor Co Ltd, is working on its new project, producing a solar ultra-thin single wafer of 25 GW used for the transformation of light into electricity. Zhang Xuenan, deputy chief engineer of the company, told Xinhua that once in full operation, the project could generate a revenue of billions of yuan and create thousands of jobs.

“This project is another example of China’s economic growth potential,” said Bo Wenguang, vice-president of the Binhai Development Research Institute of Nankai University. “The potential is gradually expanded and unleashed.”

Lishen’s general manager, Zhang Qiang, is confident that constant innovation, research, and development will keep injecting impetus into the company. Two new projects are under construction in Lishen with investment for each topping 10 billion yuan, and a third is being discussed. Once in operation, their combined production capacity could be at least 10 times the company’s current capacity.

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