Selling China's 'new normal' story to the world
Beijing needs to reassure the world of its new economic strategy to restore investor confidence
One of the most frequently heard terms in global capital markets this year must be the "new normal", which generally refers to how China plans to deal with its slower economic growth and avoid a hard landing that could have a negative impact on world economies.
The real challenge for Beijing, however, is how to explain the "new normal" story well.
Premier Li Keqiang was undoubtedly the most widely anticipated speaker at the World Economic Forum's (WEF) China-focused annual conference in Dalian last week, dubbed by the media as the "Summer Davos".
Li, in his nearly hour-long speech, tried to explain China's "new normal" story from every possible positive angle that he could think of, from innovation and technology to how to upgrade China's manufacturing level in cooperation with global partners and investors.
Economists, foreign government officials and senior executives from the event organiser WEF, praised China's economic success, particularly after Li's speech.
Privately, many China watchers said Li sounded more sincere than he had done at the same event last year as he acknowledged the difficulties China faces in its economic development while also trying to promote solutions and opportunities.
This year's World Economic Forum came at a very challenging time as Beijing is fighting battles on multiple economic fronts - from striving to reign in China's increasing stock market volatility to defending the valuation of its currency.
As such, for Li, the forum provided a perfect opportunity to engage directly with the rest of the world to explain the "new normal" story better in the hope Beijing can regain the confidence of global investors and to reduce unnecessary miscommunication and distrust with different stakeholders.
However, Beijing should have done a much better and more timely job explaining its "new normal" story.
Slow response in crisis management, partly thanks to collaborative governance that the Politburo, China's highest-level policy decision-making body, now tries to rely on, and several policy missteps due to underestimating global market reactions, should be blamed for the lack of confidence in China's "new normal" story in recent months.
Chinese leaders should be fully aware that to convince the rest of the world to believe the "new normal" story is far more important than what they will actually do with the "new normal".
The world is so well connected these days that you just can't "close the door and make a good car alone", as the old Chinese saying goes.
From that point of view, there are still lots of things that Li needs to say and do.
