Click to view GDP data (Source: Eastern Fortune Network)
Today, third quarter gross domestic product (GDP) data is about to be released. Since the beginning of this year, international institutions have repeatedly raised China's GDP growth rate expectations. The simultaneous recovery of the global economy has ignited China's export momentum, and the reform measures under the “sweet period” have strengthened the internal vitality of the Chinese economy.
Zhou Xiaochuan, governor of the People's Bank of China, said recently that “the economic growth momentum has rebounded since the beginning of this year. The GDP growth rate in the first half of the year was 6.9%, and it is expected to reach 7% in the second half. The driving force for economic growth is mainly due to the rapid growth of consumption in the household sector. ”
Tobias Adrian, financial advisor and head of the Monetary and Capital Markets Department of the International Monetary Fund (IMF), said in an exclusive interview with the First Financial Journal that the quality of China's economic growth is improving. “China is also actively adopting measures (regulatory and monetary policy) to maintain a reasonable growth of credit, which contributes to financial stability.”
China's economy is stable and good
This year, international institutions are quite optimistic about the assessment of the Chinese economy. The IMF recently stated that China's economic growth has stabilized its growth momentum from emerging markets and global sources through trade, commodity prices and confidence. It is expected that China's GDP growth rate will rise to 6.8% in 2017 and 6.5% in 2018. The forecast for April this year showed an increase of 0.2 and 0.3 percentage points respectively.
The IMF said that the upward growth forecast for 2017 reflects China's stronger-than-expected economy, mainly benefiting from supply-side reforms and previous policy support; the 2018 growth forecast is due to the IMF's belief that China will maintain more supportive Policies (especially higher public investment) achieve the goal of doubling real GDP in 2020 compared to 2010.
Zhou Xiaochuan said that from January to August, the total retail sales of consumer goods increased by 10.4% year-on-year, and consumers gradually shifted from traditional goods to services. Therefore, the service industry accelerated, and the added value of the tertiary industry accounted for about 40% of GDP 15 years ago. For the current 55%. Economic growth has promoted overall employment stability, with about 10 million new urban jobs in January-August. This is also the rate of employment growth that China's huge population needs to maintain. At the same time, CPI increased by 1.8% year-on-year, PPI increased by 6.3%, and nominal GDP growth rate reached 9.5%.
According to the GDP data of the third quarter, Zhang Jun, chief economist of Morgan Stanley Huaxin Securities, told the First Financial Reporter that exports, replenishment, and infrastructure investment were the kinetic energy to support the Chinese economy in the first half of the year, plus consumption. The service industry is relatively stable, so the GDP in the third quarter will be more rational and balanced in structure, and the contribution of services and consumption to GDP will increase.
Global "sweet period"
In addition to China's own economic momentum, this year's global economic recovery, especially the growth rate of major overseas developed economies, has also directly boosted Chinese exports.
Zhang Jun told reporters that the expansion of export growth has become an important contributor to the rise in GDP this year. In the first half of this year, net exports boosted GDP growth by 0.3 percentage points. Correspondingly, the dollar-denominated export growth rate in the first half of this year rebounded sharply to 8.5%.
He also believes that in view of the stabilization and recovery of the Morgan Stanley Global Trade Leading Index (MSGTLI) in the past two months, global trade growth will maintain a relatively stable trend in the fourth quarter, and there will be no significant contraction. China's economic growth momentum in the fourth quarter. Will continue.
Specifically, the major US economic indicators have performed well recently. The manufacturing PMI rose to 53% in September, and the unemployment rate fell to 4.3%, the lowest since the financial crisis. The manufacturing PMI of the Eurozone rose to 58.2% in September. In the six-and-a-half-year period, the service industry PMI rose to 55.6%, and the economic fundamentals remained positive; emerging countries such as Brazil and Russia also emerged from the economic depression; in late September, the Baltic Dry Index (BDI) rose to more than 1500 points, compared with the beginning of the month. The sharp increase of 21.3% indicates that the current international trade market is heating up.
In addition to developed economies in Europe and the United States, “South Korea, Vietnam, Malaysia and other neighboring countries and regions have maintained double-digit growth in exports, and good external demand has contributed to China’s export growth. China’s trade growth in BRICS countries can be maintained relatively fast in the near future. Growth," said Lian Ping, chief economist at Bank of Communications.
He also told reporters that China's export trade structure has gradually improved. In September, export products were still dominated by mechanical and electrical products and labor-intensive products, but the export of high-tech products grew rapidly, with a growth rate of 13.8%. Export growth has shifted to the central and western regions. In the first three quarters, the overall growth rate of foreign trade in 18 provinces and cities in the central and western regions was 24.7%.
In addition, Lian Ping mentioned that China's strong demand for imports may reflect the current stable domestic economy and improved production and operation. Imports in September increased by 18.7%, up 5.2 percentage points from the previous month, keeping the volume and price rising; imports increased by 17.3% from January to September. The import prices of major industrial primary products increased, and the prices of imported crude oil and iron ore increased by 6.2% and 14.6% respectively.
Quality improvement of economic growth
It is worth mentioning that in addition to the speed of growth, the quality and sustainability of China's economic growth are also improving.
Zhou Xiaochuan said this time, "From the perspective of money supply and credit data, since the beginning of this year, China has entered the deleveraging process, and the growth rate of broad money supply M2 has continued to slow down, currently less than 9%. The overall leverage rate has begun to decline. Although the magnitude is not large, the trend has already formed."
He said: "After the financial crisis, China began to implement a proactive fiscal policy and monetary policy to deal with the crisis, so in the second two years after 2009, China’s debt-to-GDP ratio rose sharply, but it is worthwhile because the Chinese economy is quickly coming from the crisis. Recovery. Now China needs to lower the leverage."
On the morning of October 14, the credit and social welfare situation was announced in September. In September, M2 increased by 9.2% year-on-year, which has been below 10% for several consecutive months. In August this year, the “Report on China Monetary Policy Implementation in the Second Quarter of 2017” issued by the central bank (hereinafter referred to as the “Report”) mentioned that the current growth rate of M2 is lower than in the past and requires a comprehensive and objective understanding – that is, M2 low growth rate. Or it will become the norm in the future, and does not mean that the support obtained by the real economy is weakened.
The "Report" also mentioned that the recent decline in M2 growth rate is a reasonable reflection of strengthening financial supervision, shortening the capital chain, and reducing multi-level nesting. It is expected that with the deepening of deleveraging and the further return of finance to the real economy, the M2 growth rate, which is lower than in the past, may become the new normal.
As far as financial stability is concerned, Zhou Xiaochuan said that the National Financial Work Conference in July this year decided to establish the Financial Stability Development Committee. In the future, it will focus on four issues: first, shadow banking, second, asset management, and third, Internet finance. It is a financial holding company.
In addition to deleveraging, the process of de-capacity is also one of the manifestations of the rising quality of economic growth. Zhou Xiaochuan said that China has begun to reduce excess capacity in the steel and cement industries. "The Chinese government hopes to promote structural reform and optimization, and attaches great importance to environmental protection. Therefore, it has voluntarily cut steel and cement production capacity by 10%. At present, the capacity has been actively The effect is expected to achieve the stated goal."