SCIO press briefing on H1 economic performance
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E-mail China.org.cn, July 15, 2016
China National Radio:
The tertiary industry has seen rapid development in the past two years, contributing a lot to the Chinese economy's steady growth. The growth of sectors classified as "others" in the accounting of the tertiary industry was even faster. Some people speculate that the performance of the sectors classified as "others" was in fact not as good. What is your view of the issue? You also mentioned that the growth of private investment is declining, triggering adjustments of a number of measures at the state level. Is it possible for the growth of private investment to rebound? Thank you.
Sheng Laiyun:
I have answered the question about private investment just now. So, I will only talk about the development of the tertiary industry. It is true that the tertiary industry is enjoying rapid growth in recent years, contributing more and more to the country's economic growth. Its share in the GDP was 50.5 percent last year. In the first half of 2016, the tertiary industry maintained its rapid growth, up 7.5 percent year-on-year. Its contribution rate to the economic growth was 59.7 percent, accounting for 54.1 percent of the GDP, up 1.8 percentage points year-on-year. It is obvious that the tertiary industry remains a major momentum builder for the steady growth of China's economy.
I would like to list a number of reasons for the rapid growth of the tertiary industry. Firstly, the accelerating development of the tertiary industry accords with the rules of industrial growth. Experiences of other countries show that the tertiary industry sees a rapid growth during the middle-late stage of industrialization. It is because as industries become more and more specialized, more producer services are needed. The stage is also a crucial period for the upgrading of residents' consumption structure, which means more consumer services are demanded. Both factors pushed the rapid growth of the tertiary industry. We all know that the tertiary industry accounts for 70-80 percent of the GDP in developed countries. The good performance of China's tertiary industry during this transition period is just following the rules.
Secondly, the Chinese government and the Party have attached great importance to the development of the tertiary industry in recent years. As our country is adjusting its secondary industry, the tertiary industry turned out to be a prominent driver for the steady growth of the economy. Hence, the central government has strengthened guidance over its development and took a series of measures which have been proved effective and boosted its growth.
Thirdly, the development of the tertiary industry accords with relevant indicators. During the first half of 2016, the tertiary industry's electricity consumption grew by 9.2 percent year-on-year, 1.1 percentage point up year-on-year and 6.5 percentage points higher than the average electricity consumption of the whole society. In the meanwhile, investment in the tertiary industry in the first half of 2016 increased by 11.7 percent, accounting for 57.7 percent of the overall investment, 1.4 percentage points up year-on-year. There is also something new about foreign investment, that is, more foreign capital was channeled to the tertiary industry from the secondary industry. During the first half of 2016, foreign direct investment in the tertiary industry increased by 8 percent, 3 percentage points higher than the growth of the whole foreign direct investment. What's more, about 70 percent of the foreign investment was directed to the tertiary industry. Tax revenue indicators also proved something. The tax revenue from the tertiary industry in the first half of 2016 grew by 10.9 percent, 4 percentage points higher than the growth of the national revenue. This accounted for 58.2 percent of the total revenue, up 1.7 percentage points year-on-year. According to a survey by the National Bureau of Statistics, enterprises above designated size saw a decrease of employees due to the efforts of de-capacity, while the tertiary industry above designated size saw an increase in employees. All these indicators match with the added value of tertiary industry.
Fourthly, the NBS attaches high attention to statistics. In recent years, we strengthened reform and innovation, and established a network of direct reporting for enterprises above designated size in the tertiary industry. Some large internet-related enterprises can directly send data; we also set up a sampling survey system for small-sized service businesses. In addition, we have cooperated with other ministries to collect administrative records. These data, when combined together, serve as a solid foundation for scientific accounting.
The Chinese modern service industries witnessed rapid growth in recent years, faster than normal service industries. Modern service industries consist of nine fields, including information transmission, software, commerce and lease, film and culture, and health and aged services. They are all in line with the direction of industrial upgrading and the upgrading of residents' consumption structure, and contain strong support. I noticed that there were a number of questions regarding this section, but if the doubters truly understand the statistical systems and accounting foundations, their doubts will be dispelled. Of course, their questions created new requirements for us. We will increase the intensity of data openness and transparency. Thank you for your question.
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