SCIO press conference on China's economic performance in H1 2022
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E-mail China.org.cn, July 20, 2022
Shou Xiaoli:
Thank you, Mr. Fu. Now the floor is open for questions. Please identify your news outlet before asking your question.
Phoenix TV:
The Chinese economy slowed down in the second quarter due to a heavy blow from the pandemic. What are your views on this? Will the Chinese economy be able to sustain a recovery? Thank you.
Fu Linghui:
Thank you for your questions. In the second quarter, such unexpected factors as complex changes in the international environment and the resurgence of COVID-19 cases at home have put the Chinese economy under much greater downward pressure. In light of this, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, all regions and departments have worked to coordinate pandemic control with socioeconomic development effectively. A package of policy measures was implemented to stabilize the economy with good results, and the pandemic resurgence was brought under effective control. The economy has, on the whole, stabilized and rebounded. The main characteristics are as follows:
First, the Chinese economy managed to resist pressure and achieve growth. In April, major economic indicators declined year on year due to the pandemic resurgence. In response, all sides involved intensified efforts to stabilize the economy and actively worked to ensure logistics efficiency. With all these efforts, we succeeded in resisting the downward pressure and getting the economy back on the track of stabilizing and rebounding, thus securing growth in the second quarter. The GDP expanded 0.4% year on year, the value-added of industrial enterprises above the designated size grew 0.7%, and the fixed asset investment was 4.2%.
Second, in terms of monthly performance, the economy began to rebound gradually in May. In April, due to the impact of unexpected factors, major indicators contracted markedly. Then, with a general improvement in the pandemic situation, the resumption of work and business production, and the payoff of several policy measures to stabilize the economy, the slide in April was halted in May. Then in June, major indicators stabilized and rebounded. Concerning production, in June, the value-added of industrial enterprises above the designated increased 3.9% year on year, up 3.2 percentage points from the previous month; the production index of the service industry grew 1.3%, compared with the 5.1% fall in May. Regarding demand, in June, the retail sales of consumer goods grew 3.1% after the 6.7% fall in May; export grew 22%, 6.7 percentage points higher than the previous month. In terms of regions, of all the 31 provincial regions on the Chinese mainland, 21, or 67%, saw faster growth in the value-added of industrial enterprises above the designated size; 30, or 96.8%, reported faster growth in the retail sales of consumer goods of enterprises above the designated sales volumes.
Third, employment and price levels were generally stable. The surveyed urban unemployment rate has fallen for two consecutive months. The rate averaged 5.8% nationally in the second quarter. It stood at 6.1% in April and fell to 5.9% in May and 5.5% in June. In June, the rate was 4.5% for those aged 25-59, the main age group for employment, a 0.6 percentage point lower than the previous month; the rate was 5.3% for migrant workers with permanent rural residency, down by a 0.9 percentage point from the previous month. Consumer prices grew by a mild 2.3% in the second quarter. The growth was 2.1% year on year in April and May, and a slightly higher 2.5% in June. The growth was much lower than that of the Eurozone and the United States, which stood at 8.6% and 9.1%, respectively, in June.
Fourth, foreign trade delivered good performance, and forex reserves remained stable. Foreign trade in goods maintained a fast growth of 8.1% in the second quarter. It grew 0.1% and 9.6% in April and May and expanded to 14.3% in June. China's forex reserves stood above $3 trillion throughout the second quarter.
Fifth, industries continued to upgrade. New industries saw fast growth. In the second quarter, the value-added of high-tech manufacturing enterprises above the designated size rose 5.7% year on year, 5 percentage points higher than that of all industrial enterprises above the designated size. The proportion of the manufacturing sector in the economy continued to increase, with its value-added accounting for 28.8% of the national GDP in the second quarter, a 0.3 percentage point higher year on year. The modern service sector also registered fast growth, as represented by the information transmission software and information technology service segment, whose value-added grew 7.6% year on year, and the financial service segment, whose value-added grew by 5.9% year on year, both remarkably faster than that of the entire service sector.
Generally speaking, the Chinese economy withstood multiple pressure and challenges in the second quarter. Its major indicators first declined and then stabilized and rebounded. Next, although the Chinese economy will still face many difficulties and challenges due to such unexpected factors as complex and grave international environment and the impact of the pandemic at home, the fundamentals sustaining China's long-term economic growth will remain unchanged. Strong resilience, enormous potential, and vast room for maneuver will remain salient features of the Chinese economy. As the policy measures to stabilize the economy continue to pay off, the Chinese economy is expected to gradually recover and maintain stable growth. Thank you.
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