SCIO briefing on national economic performance in 2014
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E-mail China.org.cn, January 20, 2015
China National Radio:
We have noticed a slowdown in the growth of fixed asset investments and in the growth of investment in the real estate market. Will this inflict some pressure on the macro economy? Also, how would you comment on some analysts' assertion that the information industry will become an alternative industry this year or in the near future, and what are your predictions for this year's development of the information industry? Thank you.
Ma Jiantang:
A remarkable downward pressure on China's economy will continue throughout this year, as it did in 2014. First of all, such pressure existed in demand. As China is still a developing country where many industries need upgrading, per-capita infrastructure levels are not very high. Hence, for a prolonged period several years ago, fixed asset investment kept growing at a fast pace, say, above 20 percent.
But recently, especially in the last year, fixed asset investment growth has indeed been dropping. The nominal growth rate of fixed-asset investment was only 15.7 percent, a result of the cooling down of the real estate market and relatively excessive overcapacity in the manufacturing sector.
The reason for this slowdown first came from overcapacity in the manufacturing sector, investment in which accounts for more than 30 percent of all investment in the country. Given this overcapacity, we should limit and control simple overlapping investment. Second, we adjusted the real estate market, remarkably slowing down its investment growth rate to 10.5 percent.
But at the same time, we should notice that the slowdown in investment growth has followed a normal pattern. In what is called the "new normal" growth pattern, the optimization of the economic structure has decelerated GDP growth. This means investment should be subject to a similar deceleration as it goes through its own structural optimization. In addition, tertiary industry, including the information industry sector and the e-commerce sector, kept growing rapidly. While we were optimizing the investment structure, we were improving investment quality.
The information industry, as I mentioned just now, is one of the new sources of momentum for China's rapid economic growth. The information industry does not belong to any standard category in the national economy. It is a derivative industry that stretches into different sectors, such as consumer products, equipment, and investment. In a broad sense, the Internet industry also belongs to the information industry. These industries showed strong and rapid growth. Thank you.
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