CustomersqueueatthecheckoutoftheSanyaInternationalDuty-FreeComplexinsouthChina’sHainanProvinceXINHUAAstheescalatingtradedisputebetweenChinaandtheUnitedStatescastsashadowovertheworld’stwolargesteconomiesandtheglobaleconomyatlarge,themuch-anticipatedChineseeconomicfiguresforthefirsthalfoftheyearoffersomecertaintyofChina’seconomicresilienceandsustainability,amidmountinginstabilityworldwide.
TheChineseeconomyexpanded6.8percentyearonyearinthefirsthalfof2018,exceedingmarketexpectations.Theratewas6.7percentforthesecondquarter,edgingdown0.1percentagepointfromthepreviousquarter,withthegrowthratewithinthe6.7-6.9-percentrangefor12consecutivequarters,accordingtodatareleasedbytheNationalBureauofStatistics(NBS)onJuly16.NBSspokespersonMaoShengyongsaidthedatashowedthecountry’seconomicgrowthremainedstablewithgoodmomentum.
“Positivefactorsunderpinninghigh-qualitygrowthareaccumulating,layingasolidfoundationforachievingthegrowthtargetforthewholeyear,”saidMao.ChinahassetitsannualGDPgrowthtargetataround6.5percentfor2018.
However,externalpressuresaremounting,anddomesticstructuraladjustmenthasnowreachedacriticalstage.Chinashouldactivelyboostdomesticdemand,invigoratetherealeconomy,copewithexternalchallengesandpreventanddefuserisks,saidMao.Lookingahead,theChineseeconomywillcontinuethetrendofseekingprogressamidstability,withthetargetof6.5percentfor2018asawholeachievable,XuHongcai,DeputyChiefEconomistofChinaCenterforInternationalEconomicExchanges,toldChinAfrica.
“Thegrowthrateislikelytocomeinat6.7percentfor2018,6.6percentfor2019and6.5percentfor2020,”saidXu,addingthatatthisrate,thegoalofdoublingChina’seconomyandtheper-capitaincomeofitsresidentsfrom2010to2020willbeaccomplished.
Consumptiondriven
AccordingtoMao,duringthefirstsixmonthsof2018,anoptimizedeconomicstructurehasbeenreflectedinastrongerservicesector,theaccelerationofindustrialupgrading,progressininnovationandgreendevelopment,andmostimportantlyrobustconsumption.
Thejobmarketwasgenerallystable,withthesurveyedurbanunemploymentratestayingat4.8percentthroughoutJuneandMay,thelowestsince2016.Inthefirstfivemonths,some6.13millionurbanjobswereadded,surpassingthefigureforthesameperiodin2017andmakingachievablethisyear’stargetofcreating13millionjobs.
Inrecentyears,theupgradingofChina’sconsumptionhasbeenaccelerating.Growthintheretailsaleofconsumergoodshassurpassedthatoffixedassetsinvestmentfor26consecutivemonths,evidenceoftheincreasingroleofconsumptionintheChineseeconomy.Domesticconsumptionhasbeentheballastforgrowth,itscontributiontoGDPgrowthashighas78.5percentinthefirsthalfof2018,up14.2percentagepointsfromayearago,accordingtotheNBS.
Duringthisperiod,theretailsaleofconsumergoodsincreasedby9.4percentyearonyear,withonlineretailsalessurgingbymorethan30percent.
“Judgingfrommajoreconomicindicators,domesticdemandhasbecomeadecisiveforceofgrowthinChina,”saidMao,predictingthatthestableandsustainedgrowthofconsumptionwillcontinueinthesecondhalfoftheyear.
SeveralfactorswillsupportsteadyconsumptiongrowthinChina.“Residentialincomehasbeenincreasingmorequicklyanddeeperpocketsfacilitatemorespending,”saidMao.“Moreimportantly,theChineseeconomyhasdevelopedtothestagethatconsumptionupgradingwillonlyspeedup,notslowdown.”
Tradeuncertainties
China’stradespatwiththeUnitedStateshasraiseduncertaintyaboutthecountry’seconomicoutlookandroileditsfinancialmarketsinrecentweeks.
TheUnitedStatesbeganimposingadditional25-percenttariffson$34billionworthofChineseproductsonJune6,ignitingthelargesttradedisputeineconomichistory.Chinawasforcedtorespondinkind,imposingthesametariffsonanequalamountofU.S.products.
AccordingtotheWorldEconomicOutlook,areportreleasedbytheIMFonJuly16,aglobalgrowthrateofjust3.9percentispredictedforthisyearandthenext.“Buttheriskthatcurrenttradetensionsescalatefurtherwithadverseeffectsonconfidence,assetprices,andinvestmentisthegreatestnear-termthreattoglobalgrowth,”anIMFstatementsaid.
“Afternearly10yearsofadjustment,theworldeconomyisfinallystartingtobottomout,enteringaphaseofrecoveryandrobustgrowth,”saidChenWenling,ChiefEconomistofChinaCenterforInternationalEconomicExchanges.“However,escalatingtradetensionscouldimpederecovery,withU.S.unilateralactiondestroyinginternationaltradingrules,globalindustrialandvaluechains,systemsofglobalgovernanceandSino-U.S.relations.”
InresponsetoaquestiononapotentialdownturnbroughtaboutbyChina-U.S.tradefrictions,YanPengcheng,SpokespersonfortheNationalDevelopmentandReformCommission,saidthattheChineseeconomyisresilientenoughtocopewiththeshockofuncertaintyintheworldeconomy.
“First,China’seconomicgrowthhasshiftedfromanoverrelianceoninvestmentandexportstorelyingprimarilyonconsumptionandservices.Meanwhile,Chinahassufficientroomforpolicychangestocopewiththefalloutofeventsintheworldeconomy-thefiscaldeficitandgovernmentdebtratioarerelativelylow,thecapitaladequacyratioatcommercialbanksishighandcorporatedebtratioisindecline.Chinaalsohasrichexperienceindealingwithcomplicatedsituations,”YansaidatapressbriefingonJuly17.
Expertssaythattherapidgrowthofimportsissettocontinueamidthewiderpushtoopenup.TheChineseGovernmenthasreiteratedonmanyoccasionsthatChinadoesnotknowinglypursueatradesurplusandhasissuedanarrayofpoliciestoincreaseimportsinanattempttopromotemorebalancedtrade,satisfypeople’sdemandforconsumptionandfacilitateeconomicstructuralupgrading.
FollowingChina’spushtofurtherreformandopeningup,cutredtapeandimplementanationwidenegativelistformarketaccessofforeigninvestment,agrowingnumberofforeignfirmshavedecidedtoincreasetheirpresenceintheChinesemarketasaresultofimprovedbusinessenvironment.
OnJuly10,Tesla,theU.S.-basedelectricSedanandSUVmanufacturer,signedanagreementwithShanghaiMunicipalGovernmentforitsfirstoverseasplant.Thefactory,withaplannedannualproductioncapacityof500,000electriccars,willbethelargestforeign-investedmanufacturingprojectinthecity’shistory.
“TheescalationofChina-U.S.tradetensionsisnotinlinewiththeinterestsofpeopleineithercountry.Yettheimpactshouldnotbeoverstatedbecausefundamentally,theChineseeconomyisdrivenbydomesticdemandanditsrealeconomy,”saidXu.
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