SCIO briefing on national economic performance in 2014
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E-mail China.org.cn, January 20, 2015
Phoenix Television:
Commissioner Ma, would you please predict China's economic trends in 2015? As seen from the quarterly GDP, the Chinese economy has been on a downward trend since 2014. What do you think the economy is likely to be like this year? We have also heard a lot of people talking about "dropping GDP" [paying less attention to GDP], but if one were to look at many of these major figures without hearing your interpretation, we would assume that the economy was indeed very bad in 2014. Will this situation have an impact on the future? Will there be any new statistical methods to reflect the Chinese economy this year, especially the achievements in structural transformation? Thank you.
Ma Jiantang:
The major work of the National Bureau of Statistics is to look at the past accurately instead of predicting the future. But since you raised the question, I might as well say something here.
When predicting the economy's outlook in 2015, the most important thing is to clarify what kind of domestic and international environment we face. This environment has two sides. On the one hand, the economic environment in 2015 is rather complicated and challenging. Some advanced economies in the international community are recovering at a faster pace while some major economies are experiencing rather difficult and tepid recoveries. Monetary policies in advanced economies differ from one another. Additionally, due to the volatile international geopolitics and the diving prices of crude oil and other commodities, the international economic environment in 2015 is not that promising – it is quite complicated and even daunting. In China, due to the influence of the "three phases," (the three phases are the changes in growth rate, the brunt of structural adjustment and the impact of the stimulus package) and various continuing conflicts, the economy still faces much downward pressure. We have to be aware of these difficulties and prepare for them. More importantly, we should also recognize that there are still many favorable conditions for the Chinese economy to maintain a stable and rapid development or medium to high growth rate. There is still great potential and room for development. These conditions are as follows:
First, there is the momentum provided by the new "four modernizations," namely industrialization, informatization, new urbanization and agricultural modernization. These are the fundamental factors that form a solid basis for the steady development of the Chinese economy in 2015. We must bear this in mind when predicting economic trends since these are the core of economic movement. I'll just cite two examples. First, new urbanization. We will address three "100 million people" issues in the 13th Five-Year Plan: improving the rights as urban residents for the 100 million people who are currently living in cities, moving 100 million people in central and western China from villages to nearby towns, and renovating the villages within cities that are home to 100 million people. Urbanization involves tens of thousands of people coming to cities and towns, which improves the efficiency of resource allocation and promotes economic growth. Urbanization also creates huge demands. Citizens living in cities have more needs than they have when they live in villages. Urbanization will create huge demand for housing, medical treatment, education and health care. Urbanization is therefore an important force in increasing both supply and demand.
Another example is informatization. Information technology, mobile Internet, big data, and the Internet of things have a huge impact on production and people's lives, and they demonstrate tremendous potential. The Internet and mobile Internet have changed China's business models profoundly and have brought forth the rapid growth of e-commerce. They are also changing China's finance model, and new types of finance are also rapidly developing. Many other sectors are also influenced by informatization. The tremendous potential in this area will provide huge momentum to the Chinese economy.
Second, the lasting enthusiasm for starting one's own business and for innovation -- which is brought by reform and opening-up -- is an enduring force behind the steady development of the Chinese economy. Reform and opening-up has been a crucial move in the course of China's economic development, and it is also the key to China's ever-rising status and ever-expanding economy, as well as to the momentum needed for steady economic development during the 13th Five Year Plan and beyond. Streamlining administration, delegating power to the lower levels, providing more market access, and reducing red tape will mobilize the enthusiasm of China's 900-million-strong labor force and the millions of people working in science and technology. Starting one's own business and innovating will employ people and require capital. Since the reform of the business registration system in 2014, the number of players in the market increased by 10.05 million from March to November.
The year 2014 is the first year of China's [new round of] reform, and opening-up will continue this year. Reform will break the fetters and barriers to starting one's own business and innovation, activating the enthusiasm of 1.3 billion Chinese and the 900 million people in its labor force. This is where the hope of the Chinese economy lies.
Third, the macro adjustments carried out by the Central Committee of the Communist Party of China (CPC) and the State Council are key to maintaining steady economic development. The new "four modernizations" form the basis for this development, reform and opening-up provide its momentum and scientific macro adjustment forms its keystone. The economy is bound to experience fluctuations that need to be handled by macro adjustment. In addition to enacting proactive fiscal policy and prudent monetary policy, the Central Committee of the CPC and the State Council also enhanced control over the economic growth range and targeted adjustment, carried out appropriate fine-tuning. These actions were important to steady economic development in 2014 and will be an important factor in steady and rapid growth in 2015. In summary, we have to be aware that the Chinese economy will face a daunting domestic and international environment in 2015, but we also have to recognize that the Chinese economy has the potential and conditions to maintain a medium-high growth rate and become highly advanced. We have the solid basis, everlasting momentum and continuous innovation of macro adjustment. The Chinese economy will keep a steady, rapid and medium-high growth rate in 2015. As for the economic growth goal, we shall await the National People's Congress and the Chinese People's Political Consultative Conference this year.
The second question you raised is quite good. As the Chinese economy enters the "new normal," it is a very important task for China's statistics bureau to understand and adapt to the "new normal" and channel our current efforts toward transformation and upgrading.
We recently held a national statistics conference and decided on the following points to channel efforts to transform and upgrade the economy: We must reflect the entire economy more accurately; demonstrate the improvement of China's economic structure more comprehensively; and reflect the improvement of China's economic quality in a more timely manner. We should make greater efforts to reflect and analyze the structure and quality of the Chinese economy rather than the overall economic gross and growth rate. This is what we have in mind about the "new normal" and what we are trying to do at present. Indexes for assessing structure and quality have already been added to our analysis report and some statistics. Of course, we need to make more efforts, and we welcome joint efforts from the media. Thank you.
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