Does expanding domestic demand imply closing the door to development? Recently, some Western narratives have suggested that China's emphasis on "building a strong domestic market" and "expanding domestic demand" will crowd out foreign investment, even signal an abandonment of the "dual circulation" strategy, ultimately leading to isolation. These voices mistakenly pit "expanding domestic demand" against "expanding openness," reflecting a fundamental misunderstanding of China's developmental logic. The tendency in some Western circles to reflexively equate "expanding domestic demand" with "reducing openness" stems partly from their own historical context. In Western economic governance models, addressing economic downturns and boosting domestic demand has often involved trade protectionism—erecting barriers, excluding foreign goods and capital, isolating domestic markets from the global system, and even adopting beggar-thy-neighbor policies. This old path of "protecting domestic demand through closure" has been a habitual crisis response in the modern West, leading some to mistakenly assume that any nation emphasizing its internal market must inevitably turn inward and reduce openness. However, this is not the path China has chosen in shaping its new development paradigm.
What, then, is the relationship between "expanding domestic demand" and "expanding openness" in China's strategic planning? Is it a zero-sum, mutually exclusive relationship, or one of symbiotic coordination? Consider the example of new energy vehicles (NEVs). In recent years, surging domestic demand for NEVs in China has been accompanied by robust exports, driving rapid development across the global industry. While a traditional fuel-powered car typically requires 600-700 chips, an NEV needs 1,600 or more. As China leads in NEV production, its import demand for high-end chips and raw materials for power batteries has also increased significantly. Therefore, one cannot simply look at the rise in China's NEV exports; one must also recognize China's role in the global industrial structure. Expanding domestic demand in China does not lead to isolation; rather, it drives the upgrading of global industrial chains and optimizes the global industrial structure, strengthening China's connections with the world.
Furthermore, the process of expanding domestic demand in China inherently promotes the mutual reinforcement of domestic and international cycles. Building a strong domestic consumer market requires removing bottlenecks within the domestic market, ensuring smoother circulation of goods nationwide, and establishing unified market rules. This not only enhances the efficiency of the domestic cycle but also provides better infrastructure and institutional safeguards for the international cycle. Expanding domestic demand is not about closing the door; it is about strengthening the domestic economy to open the door wider and with greater confidence. It is not about abandoning "dual circulation"; it is about solidifying its foundation.
Simultaneously, regardless of the cycle, maintaining cost and price competitiveness relies on achieving greater scale. Expanding domestic demand (increasing domestic customers) and expanding openness (increasing international customers) are essentially the same: both aim to enlarge the service base for the supply side, reducing costs and improving efficiency. This is straightforward to understand. Only with robust domestic demand, smooth industrial chains, and active consumption and investment can the economy sustain continuous vitality. The smoother the domestic cycle, the stronger the economic foundation, and the greater the appeal to the world. This is akin to a highly popular commercial district: the more prosperous the business, the more it attracts top brands, high customer traffic, and premium resources, forming a powerful "gravitational field." Once this "gravitational field" is established, it steadily supports the international cycle: high-end technologies, key components, and quality goods can be imported more smoothly, while China's competitive products, services, and innovations can be exported more efficiently. The domestic cycle is the foundation; the international cycle is its extension. The stronger the foundation, the broader the stage for opening up.
Why has China particularly emphasized "expanding domestic demand" and "building a strong domestic market" in recent years? This does not signify a change in China's opening-up policy but responds to two profound shifts. First, the external environment has changed profoundly. Amid accelerating global transformations unseen in a century and the rise of unilateralism and protectionism, it is neither realistic nor sustainable for China, as the world's second-largest economy, to rely long-term on external demand for growth momentum. Second, China's domestic market has undergone profound changes. With a population exceeding 1.4 billion and a per capita GDP surpassing $10,000, China has become the world's largest and most promising consumer market. Expanding domestic demand is not only a necessary response to external conditions but also a proactive choice to leverage China's super-large market advantage.
Expanding domestic demand and building a strong domestic market also foster mutual benefit and common development between China and the world through two-way flows. Against a backdrop of relatively weak external demand, China's consumption recovery and market expansion have boosted imports ranging from agricultural products and energy to high-end consumer goods and intermediate products, generating substantial orders for enterprises in many countries. Sharing in the growth dividends of the Chinese market has become a consensus among a growing number of economies. Additionally, the growth of Chinese tech companies enables more countries and regions to benefit from China's intelligent era. All this demonstrates that China's development remains oriented toward the world; the process of strengthening itself inherently offers more choices and opportunities globally. China continues to be a stabilizer and driving force for the world economy.
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