By Yu Siluan
BEIJING: China’s slackened pace of GDP growth over recent years has stirred world-wide concern about the country’s economy. Official data released in late February showed that China’s GDP expanded by 7.4 percent in 2014. This rate met the government’s growth target but was nevertheless the slowest rate of expansion in 24 years.
Keeping with tradition, Premier Li Keqiang released the country’s economic growth target in the government work report at the ongoing NPC and CPPCC on Thursday. Analysts believe that policymakers have sufficient confidence in the economy and are unconcerned about fluctuations in GDP growth over the short term.
Analysts say that consumption will play an increasingly important role in fueling growth amid the current slowdown in investment and downturn in exports. A compelling example here is the fact that turnover reached 35 billion yuan ($5.6 billion) during last year’s Singles’ Day, a day when online commerce companies roll out heavy discounts to drum up sales. The latest statistics showed that consumer expenditures accounted for 51.2 percent of China’s GDP growth in 2014, 3 percent more than that in 2013.
The stunning trading volume on last year’s Singles’ Day reflects the huge consumptive potential of China. Actually, the Chinese government has been pushing to increase the role of domestic demand while at the same time reducing dependence on investment and exports.
An active e-commerce market has promoted a boom in relevant services. For example, more than 15,000 young people from all over the country are working in Qingyan Liucun, a village in Yiwu, Zhejiang Province. They are operating more than 2,800 online shops and about 30 courier companies. The current situation in Qingyan Liucun represents a new source of vitality in China’s economy.
China has entered a “new normal,” a phase during which its economy will develop at a more moderate pace. At this stage, the Chinese government is paying more attention to the quality of economic growth than sheer speed as it devotes itself to optimizing its economic structure and improving people’s livelihoods.
In fact, China’s economic structure is orienting toward a healthy position. Statistics showed that the services sector accounted for larger share GDP, reaching 48.2 percent in 2014. In the meanwhile, China’s Gini coefficient – a measure of inequality – went down in 2014. The high- and new-technology industries witnessed double-digit growth in 2014, outpacing the sector average.
Employment and residents’ income has been rising despite decreasing economic growth. Statistics showed that 13.22 million new urban jobs were created last year. And the disposable income for the average Chinese citizen grew by 10.1 percent.
The Chinese government views 2015 as a key year in which China will deepen its reforms in a comprehensive manner and further invigorate the market.
Ma Jiantang, the commissioner of the National Bureau of Statistics (NBS), indicated that China will adapt to the “new normal” and maintain its economic growth rate in a reasonable range. He also said the risks to China’s economy are still controllable although there is a continued economic downturn.
An economist close to Chinese government decision-making said that China still has one of the fastest rates of GDP growth in the world despite the recent slowdown. He also stressed that fluctuations in economic growth are acceptable as long as there is still full employment, stable commodities prices and steady income growth.
By Yu Siluan