As world leaders prepare to gather in Hangzhou to discuss the global economy, many issues will relate to a group of nations called the BRICS, namely Brazil, Russia, India, China and South Africa. This week Global Business rolls out a series of stories to dissect the state of each of the five BRICS economies.
Before we talk about China, we take a look at the overall BRICS economy in 2015 and have a mixed picture in terms of growth. Growth in China was slower than in previous years but remained strong. India's growth, on the other hand, gained momentum. However, the performances of the other three countries weren't as shiny. The economies of South Africa and resources-dependent Brazil and Russia's economies also declined on weak global trade and a plunge in commodity prices.
Let's look at China. Chinese Finance Minister Lou Jiwei said ahead of the G20 summit, that China has contributed some 25 percent to the world's economic growth, when the size of the country's economy counts for only 15 percent of the world economy.
That's all thanks to stellar growth performance over the past few years. China's economic growth is one of the most closely watched developments by economists, businesses and financial professionals worldwide. But is growth the only metric when we talk about economic contributions?
China's steady economic growth has long been a major stabilizer for global trade, investment, and financial markets. But as the speed of the country's expansion has gradually slowed, many are concerned whether the Chinese government can meet its growth target of 6.5 to 7 percent for 2016.
"China will most definitely meet its target. We know that consumption is still growing very fast. We also see that retail sales are also doing well. So that is the main driver of growth. Investment growth is of course much lower," said Jurgen Conrad, head of Economics Unit, ADB.
"But thanks to government support for infrastructure investment and also stronger than expected housing investment in the first half, we have a little more support than we expected."
Conrad said that besides growth speed, people should also look at the substantial economic value that China created each quarter, thanks to a large base.
"Despite the growth deceleration in recent years, the contribution to global growth that China is making is actually larger than five, six years ago when China was growing at double digit rates," said Jurgen Conrad.
But is GDP the only metric to measure a country's economic contribution to the world?
"In terms of global poverty alleviation, no country has come anywhere close to the amazing achievement that China has made in the last 20 to 30 years. So China's influence in the global economy is huge and you can pick any variable you like," said Jeremy Stevens, Asia economist of Standard Bank.
There are a lot of areas where China is making a contribution to world economy, and experts say that today, one of the biggest contributions that China can make, is infrastructure cooperation with other nations.
National strategies, such as the "Belt and Road" initiatives, as well as institutions such as the Asian Infrastructure Investment Bank, are advancing China's effort on that front by providing expertise as well as funding to a series of infrastructure projects across the belt and road region. New progress also was made during July's G20 trade minister meeting.
"Ministers have endorsed a G20 guidance for global investment policy making. Cross-border infrastructure projects are for the first time endorsed by G20 ministers. You know the endorsement itself is very important as it provides legitimacy for China as well as other economies to boost these activities in terms of infrastructure," said Chen Xiaochen, deputy director of Dept. of International Studies, RDCY.
Chen said that as world officials gather next month for the G20 leader summit in Hangzhou, they should find a good platform for China and other participating countries to reaffirm top-down support for global infrastructure connectivity, which he says, is a cross-border growth driver.
