CHINESE ECONOMY FORESEES BETTER PROSPECTS
(People's Daily Online, english.people.com.cn)
10 marzo, 14:13
(People's Daily Online)
Is the Chinese economy facing a recession?
China's economic situation is better than expected
In recent years, China's economic growth rate has been slowing
steadily, so there is a view that the economy is facing
recession.
Responding to this, economist and CPPCC member Lin Yifu said
that economic slowdown in China is mainly due to the weak
international economic situation. For instance, in 2013 the U.S.
economy witnessed 1.8 percent growth and the EU saw negative growth of 0.4 percent. In addition, the two other major emerging economies, India and Brazil, had bigger economic slowdowns than China. Xu Shaoshi said we should examine the economy from an overall perspectivve. In 2013, China's economic and social development remained steady: GDP saw 7.7 percent growth, the CPI rose only 2.6 percent, new employment provided jobs for 13.1 million, and national per capita disposable income grew by 8.1 percent. All of these figures are better than expected. Last year tertiary industry's share of GDP exceeded that of secondary industry for the first time, marking the fact that China has made important progress in restructuring, according to Xu. To expressions of concern about economic slowdown in China, Xu responded that by maintaining 7 percent growth rate, China can achieve its goal of building a moderately prosperous society by 2020. Its 7.7% growth rate is the highest of any of the world's developed countries and the major developing countries. "We will not pursue speed, but we will not allow economic growth to slip below a baseline. We will create favorable conditions for restructuring and reform." Slight fluctuations in economic growth are normal and are in line with economic laws. The fundamentals of China's economy have not changed, according to Xu. Xiang Xiaomei, an expert with the Guangdong Academy of Social Sciences and also a NPC deputy, said that some people were spreading "recession theories" on the Chinese economy with the intention of putting pressure on China and creating opportunities for themselves. "We should face the doubters with broad minds and confidence", said NPC deputy Yan Chengzhong, also director of the Institute of Economic Development and Cooperation at Shanghai-based Donghua University. The reasons for China's economic slowdown lie in factors such as adjustment and transformation just as much as in the sluggish global economic environment. Is China still favored by foreign investors? In January of this year, China's actual use of foreign investment achieved double-digit growth, which shows that China is still a favorite for foreign investors. According to data released by the Ministry of Commerce (MOC), in January of this year, China's actual use of foreign investment amounted to 10.76 billion U.S. dollars, a year-on-year increase of 16 percent. The MOC spokesperson Shen Danyang said this was the most convincing answer to the question whether China still offers a sound investment environment, or whether foreign investors still have confidence in China's economic development.
CPPCC member Guo Yuanqiang said the actual use of foreign investment in Gaungdong, the country's leading foreign trade province, reached almost 25 billion U.S. dollars, an increase of just under 6 percent. The service sector accounted for 45.1 percent, up 4.5 percentage points. In addition, contracted foreign investment and actual use of foreign investment from the European Union rose 103.3 percent and 107.6 percent respectively. "From the perspective of developing business, the economic downturn is exaggerated", said NPC deputy Cui Genliang, also President of Hengtong Group. The structure of export business is being optimized in Jiangsu.
In January, mechanical and electrical products exports amounted to 109 billion yuan, an increase of 6.8 percent over the same period of last year, accounting for 61.7 percent of the province's exports, which reflects the trend of transformation and upgrading. A figure from Kunshan's labor-intensive industries also shows the changes brought about by industrial transformation - laptop assembly has declined from 120 million units in 2010 to 65 million units in 2013. It is understood that equipment manufacturing, modern services, photoelectric information technology, renewable energy and other fields are all new growth areas for investment by Taiwanese companies.
ow are China's future development prospects? There are still considerable opportunities in China's economy.
It should achieve growth, both in quality and efficiency. According to the China-economy pessimists, the reason why China's economy will collapse is that for a considerable length of time, Chinese economic growth has been driven by investment, but investment-driven growth is not sustainable.
Economist Lin Yifu believes that we cannot ignore the positive role of the consumption, but a country must not be over-reliant on consumption-driven economic growth. We are surrounded by evidence that past national debt crises were caused by excessive consumption. China should still hold to the investment-led economic growth model, according to Lin. On the one hand, China should rely on technological innovation to improve workforce production levels and increase revenues. On the other hand, China should rely on industrial upgrading, constantly improve infrastructure, and reduce transaction costs to achieve growth, both in quality and efficiency. China's development prospects are very good. First, from a global perspective, the level of government debt is relatively low. Overall debt accounts for only 39.4 percent of GDP, while in most developed countries the figure is 100 percent. Japan's government debt has reached 200 percent. So China has the room to take a proactive fiscal policy. In addition, there is a very high level of private savings in China, and China has nearly 4 trillion yuan of foreign exchange reserves. In these favorable conditions, China will have no problem in maintaining growth between 7.5 percent and 8 percent in the next few years. NPC deputy Yan Chengzhong says there are still considerable areas of potential growth in China's economy, such as urbanization, improving the ecological environment, and increasing the contribution of consumer spending. To address its current problems, China should continue with a comprehensive program of reform, and work to further enhance the endogenous dynamics of the economy and market vigor, according to Xu Shaoshi.
economy witnessed 1.8 percent growth and the EU saw negative growth of 0.4 percent. In addition, the two other major emerging economies, India and Brazil, had bigger economic slowdowns than China. Xu Shaoshi said we should examine the economy from an overall perspectivve. In 2013, China's economic and social development remained steady: GDP saw 7.7 percent growth, the CPI rose only 2.6 percent, new employment provided jobs for 13.1 million, and national per capita disposable income grew by 8.1 percent. All of these figures are better than expected. Last year tertiary industry's share of GDP exceeded that of secondary industry for the first time, marking the fact that China has made important progress in restructuring, according to Xu. To expressions of concern about economic slowdown in China, Xu responded that by maintaining 7 percent growth rate, China can achieve its goal of building a moderately prosperous society by 2020. Its 7.7% growth rate is the highest of any of the world's developed countries and the major developing countries. "We will not pursue speed, but we will not allow economic growth to slip below a baseline. We will create favorable conditions for restructuring and reform." Slight fluctuations in economic growth are normal and are in line with economic laws. The fundamentals of China's economy have not changed, according to Xu. Xiang Xiaomei, an expert with the Guangdong Academy of Social Sciences and also a NPC deputy, said that some people were spreading "recession theories" on the Chinese economy with the intention of putting pressure on China and creating opportunities for themselves. "We should face the doubters with broad minds and confidence", said NPC deputy Yan Chengzhong, also director of the Institute of Economic Development and Cooperation at Shanghai-based Donghua University. The reasons for China's economic slowdown lie in factors such as adjustment and transformation just as much as in the sluggish global economic environment. Is China still favored by foreign investors? In January of this year, China's actual use of foreign investment achieved double-digit growth, which shows that China is still a favorite for foreign investors. According to data released by the Ministry of Commerce (MOC), in January of this year, China's actual use of foreign investment amounted to 10.76 billion U.S. dollars, a year-on-year increase of 16 percent. The MOC spokesperson Shen Danyang said this was the most convincing answer to the question whether China still offers a sound investment environment, or whether foreign investors still have confidence in China's economic development.
CPPCC member Guo Yuanqiang said the actual use of foreign investment in Gaungdong, the country's leading foreign trade province, reached almost 25 billion U.S. dollars, an increase of just under 6 percent. The service sector accounted for 45.1 percent, up 4.5 percentage points. In addition, contracted foreign investment and actual use of foreign investment from the European Union rose 103.3 percent and 107.6 percent respectively. "From the perspective of developing business, the economic downturn is exaggerated", said NPC deputy Cui Genliang, also President of Hengtong Group. The structure of export business is being optimized in Jiangsu.
In January, mechanical and electrical products exports amounted to 109 billion yuan, an increase of 6.8 percent over the same period of last year, accounting for 61.7 percent of the province's exports, which reflects the trend of transformation and upgrading. A figure from Kunshan's labor-intensive industries also shows the changes brought about by industrial transformation - laptop assembly has declined from 120 million units in 2010 to 65 million units in 2013. It is understood that equipment manufacturing, modern services, photoelectric information technology, renewable energy and other fields are all new growth areas for investment by Taiwanese companies.
ow are China's future development prospects? There are still considerable opportunities in China's economy.
It should achieve growth, both in quality and efficiency. According to the China-economy pessimists, the reason why China's economy will collapse is that for a considerable length of time, Chinese economic growth has been driven by investment, but investment-driven growth is not sustainable.
Economist Lin Yifu believes that we cannot ignore the positive role of the consumption, but a country must not be over-reliant on consumption-driven economic growth. We are surrounded by evidence that past national debt crises were caused by excessive consumption. China should still hold to the investment-led economic growth model, according to Lin. On the one hand, China should rely on technological innovation to improve workforce production levels and increase revenues. On the other hand, China should rely on industrial upgrading, constantly improve infrastructure, and reduce transaction costs to achieve growth, both in quality and efficiency. China's development prospects are very good. First, from a global perspective, the level of government debt is relatively low. Overall debt accounts for only 39.4 percent of GDP, while in most developed countries the figure is 100 percent. Japan's government debt has reached 200 percent. So China has the room to take a proactive fiscal policy. In addition, there is a very high level of private savings in China, and China has nearly 4 trillion yuan of foreign exchange reserves. In these favorable conditions, China will have no problem in maintaining growth between 7.5 percent and 8 percent in the next few years. NPC deputy Yan Chengzhong says there are still considerable areas of potential growth in China's economy, such as urbanization, improving the ecological environment, and increasing the contribution of consumer spending. To address its current problems, China should continue with a comprehensive program of reform, and work to further enhance the endogenous dynamics of the economy and market vigor, according to Xu Shaoshi.
