The world today is undergoing unprecedented changes. Trade frictions triggered by the United States have undermined economic and trade relations between it and China and brought uncertainties to the global economy.

Amid the trade frictions, all countries in the world have focused on how China copes with the tensions and what principles it upholds.

China's enviable growth story over the past 40 years has been the unfolding of reform and opening-up. And this is a dynamic process that the country will continue to advance.

A research team led by Chi Fulin, head of the China Institute for Reform and Development, has released a report that shows that by deepening reform and expanding opening-up, China can develop a new type of large open economy that will not only help it cope with the immediate short-term challenges, but also promote for its medium-and long-term development, enabling it to realize the objectives of the 14th Five-Year Plan (2021-25), while upholding the principles it believes in.

Resolute in upholding free trade and economic globalization, China remains a strong promoter of improved global economic governance. It stresses inclusive mutual learning and opposes any country imposing its views and values on another.

China has become the world's largest developing country through peaceful development, and it will continue to focus on common development and the forging of mutually beneficial relations based on respect and win-win cooperation.

But although China is in a period of important strategic opportunities, with considerable leeway for its economic transformation and upgrading, it also faces unprecedented risks and challenges, and the dramatic changes in the external environment.

To cope with these challenges, China needs to deepen its own reforms and expand its opening-up.

China has a large market and is steadily upgrading its technologies. As long as it further promotes reform of its systems and mechanisms and allows the market to play a decisive role in the allocation of resources, it can continue to maintain steady economic performances and contribute to global economic growth.

No country can develop in isolation in the era of economic globalization, so coordination and cooperation are inevitable choices. The history of humankind shows that only free trade and full participation in economic globalization can expand the global market, no country can develop by steering away from economic globalization. In fact, prioritizing domestic interests often leads to unwanted results. All countries need to give full play to their respective comparative advantages by improving cooperation, finding development paths in line with their respective conditions and boosting their domestic economies.

This will provide new pathways to improve the global economic governance system. At present, global governance mechanisms and structures of organizations such as the World Trade Organization, the International Monetary Fund and the World Bank need to be improved. China advocates equality-based, open-oriented and cooperation-driven global economic governance.

By proposing the Belt and Road Initiative that promises greater interconnectivity among participating countries, China has made a significant contribution to improving global economic governance.

The report by the China Institute for Reform and Development, A New Type of Large Open Economy, offers a comprehensive analysis of such important issues, and it details China's efforts at furthering reform. These include creating a more internationalized business environment based on the rule of law, transforming industrial policies, strengthening intellectual property protection and accelerating reforms of regulatory systems in line with higher-level opening-up. It shows that China's opening-up and reform are highly integrated.

According to the report, China will continue to achieve economic growth of around 6 percent in the next few years and can effectively cope with external pressure as long as breakthroughs are made in advancing the necessary reforms.

By focusing on promoting the transformation and upgrading of the Chinese economy, taking fundamental international economic and trade rules as a reference and ensuring the decisive role of the market in resource allocation, China will be able to successfully establish a new type of large open economy.

The author is former director of the Research Office of the State Council and director of the Academic Committee of China Society of Administration Reform.

The author contributed this article to China Watch exclusively. The views expressed do not necessarily reflect those of China Watch.

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