With foreign direct investment reducing in China, and trade and exports also constituting a smaller part of the Chinese GDP, the rise of de-globalisation could cause lasting damage to the Chinese economy. According to the latest communication from the Chinese politburo, apart from the ‘six stabilities’ and ‘six guarantees’ emphasized since the outbreak of the epidemic, the Chinese leadership is considering prioritising self-reliance and domestic growth, under the big banner of ‘Double Circulation’ led by the domestic economic cycle. Simply put, the politburo determined that it would be better for China to develop its domestic market in a deeper manner for the long term.

As various economic indicators in China continued to improve, it would be an opportunity to jump on the growth train. Considering the government’s emphasis on the domestic market, prioritizing technological research and reducing reliance on foreign imports, relevant sectors in China should continue to see much growth with governmental help. Therefore, we have a stronger conviction to stay bullish on the new economy sector, eyeing on better upside potential in the mid to long-term.