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The Chinese Economy Continues to Stabilize with Sound Growth

Submit Time:04-07-2017 | Zoom In | Zoom Out

Author:Zhang Yi | Source:Guang Ming Daily

Abstract:

  "The overall economic performance in May is stable with sound growth," said Liu Aihua, spokesman of the National Bureau of Statistics, at the press conference held by the State Council Information Office on June 14.

  Facts have proved that the Chinese economy has maintained a strong impetus of smooth operation and continued the good trend of stable and sound progress, as evident by fruitful highlights.

  Highlights in the four macroeconomic indicators

  How did the Chinese economy perform? The macroeconomic data released on June 14 provided a best answer.

  First, production and demand: In terms of the supply side, in May, the added value of industries above designated size increased by 6.5% year on year, and the production index of the service industry rose by 8.1%, showing that production maintained a very stable situation. In terms of the demand side, total retail sales of social consumer goods increased by 10.7% in May, and investment grew by 8.6% from January to May, demonstrating the trend of "stable growth" and "slight slowdown." In terms of overseas demand, foreign trade continued to grow steadily in May, and exports grew 1.2 percentage points faster than those in last month. "Domestic demand and overseas demand promote each other in a balanced manner, and economic growth remains relatively stable." Liu Aihua pointed out.

  Second, employment: In the first five months, 5.99 million people were newly employed in urban areas nationwide, an increase of 220,000 over the same period last year, accomplishing 54.4% of the target of 11 million people set out by the government work report at the beginning of the year.

  Third, prices: In May, CPI rose by 1.5% year on year, up 0.3 percentage point over the previous month; the core CPI excluding energy and food rose by 2.1%, exhibiting a moderate increase of prices.

  Fourth, improvement in balance of payments: Trade surplus was maintained in May although it narrowed year on year; at the end of May, the exchange rate of the renminbi against the US dollar was 6.8633, up 0.43% over the end of April, remaining basically stable; foreign exchange reserves rebounded for four months in a row and reached 3.0536 trillion US dollars at the end of May, and they stayed above 3 trillion US dollars on the whole.

  Increased efforts on the supply-side structural reform

  "Thanks to the continuous function of the supply-side structural reform, the real economy continued to stabilize with sound growth this year." Liu Aihua pointed out in response to a reporter's question that in May, the added value of industries above designated size increased by 6.5%, higher than that in the same month last year; corporate profitability improved, as evident by the fact that from January to April, profits achieved by the industrial enterprises above designated size increased by 24.4% year on year.

  Data show that the five tasks of "cutting production overcapacity, depleting stocks, deleveraging, reducing costs and bolstering weak spots" continued to move forward this year. In terms of cutting production overcapacity, more than 60% and 40% of the targets of cutting steel and coal production capacities were accomplished, respectively. In terms of depleting stocks, the area of commercial housing for sale fell by 8.5% year on year at the end of May, up 1.3 percentage points over the last month. In terms of deleveraging, at the end of April, the asset-liability ratio of industrial enterprises above designated size was 56.2%, down 0.6 percentage point year on year. In terms of reducing costs, from January to April, the cost per RMB 100 of main business income of industrial enterprises above designated size reached RMB 85.51, down RMB 0.06 over the same period last year. In terms of bolstering weak spots, investment in ecological and environmental protection and investment in public facilities management maintained a relatively rapid growth.

  "The endogenous power of economic growth was continuously released, the innovation-driven development strategy was implemented in depth, the entrepreneurship and innovation strategy progressed constantly, and new drivers developed rapidly." Liu Aihua analyzed that in May, the added value of high-tech industries and the equipment manufacturing industry grew by 11.3% and 10.3%, respectively, both of which were higher than the growth in the added value of industries above designated size; growth in online retail sales continued to accelerate, as evident by the fact that from January to May, online retail sales of physical goods rose by 26.5%, up 0.6 percentage point over the last month, and if services were included, all online retail sales grew faster by 32.5%.

  Enhanced factors that support the stable and sound growth

  "In the new normal, the change pace of economic growth depends mainly on the transition of growth drivers and the structural adjustment. If the transition of growth drivers proceeds faster, the overall economic stability with sound growth will be able to continue." Zhang Liqun, researcher of the Development Research Center of the State Council, pointed out.

  In the first quarter, the added value of China's service industry accounted for 56.5% of GDP, higher than 51.6% of last year. The service industry firmly dominated around half of the national economy, leading to a stronger industrial support for the stable and sound economic growth in China. High-tech industries, equipment manufacturing and new products grew rapidly, and the output of many products that are designed in line with the direction of industrial development and consumption upgrade grew in an accelerated manner. The output of industrial robots rose by 50.4% from January to May.

  This year, the real economy especially corporate profitability improved, enhancing enterprises' investment capacity and investment expectations as well as their confidence in development. In May, the purchasing managers' index (PMI) of manufacturing was 51.2%, falling in a prosperity range for ten consecutive months; the PMI of small businesses was 51%, up 1 percentage point over last month, rising to the prosperity range for the first time in recent years. This shows that the improvement of enterprise operation conditions gradually extended from upstream industries to downstream industries, and small businesses were gradually restoring their confidence.

  As the supply-side structural reform advanced, the supply quality of services and products upgraded and new business forms such as sharing economy developed rapidly. "Domestic demand has great growth potential and space, and the key is to identify where to input efforts. It is necessary to continue to implement all the measures introduced by the CPC Central Committee and the State Council, change the relatively low growth of private investment, and release the space and potential of investment." Liu Aihua stressed.

  As to the future trend of economic operation, Liu Aihua made such a judgment, "From the perspectives of industrial support, development driver, development confidence, and development environment, all kinds of supporting factors are constantly enhanced, and we have full capacity, confidence and condition to consolidate and continue the situation of stable and sound economic growth."


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