BIZCHINA> Review & Analysis
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BIZCHINA> Review & Analysis
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Strong foundation to help China sustain growth
By Ma Jiantang (China Daily)
Updated: 2008-12-11 07:43 The author is director of the National Bureau of Statistics. This is an edited version of his article which appeared in the latest issue of Qiushi magazine China has managed to overcome the adverse impact of several destructive natural calamities and the international financial crisis this year and maintain a steady economic growth.
The country achieved a 9.9 percent economic growth rate in this year's first three quarters, slightly higher than the average growth rate of the country's gross domestic product since the reform and opening-up policy was adopted in 1978. The rate is also in sharp contrast with the sluggish global economy, especially those of the US, the European Union and Japan, the world's main economies that have already gone into recession. Compared with the 7 percent growth rate achieved in the same period by the other three members of the BRIC, an abbreviation for the group that also includes emerging economies Brazil, Russia and India, China's 9.9 percent is not a mean figure. The world's largest developing country has also made remarkable achievements in controlling inflation. Its consumer price index (CPI) stood at 6.7 percent year on year during the preceding 10 months, with a decline in six consecutive months since May. In particular, its 4.9 percent, 4.6 percent and 4.0 percent CPI growth rates in August, September and October respectively suggest that the ticklish issue of inflation has been kept under control. In solving the issue of employment for its enormous population, China has also made great progresses. Due to relentless efforts by governments at all levels, 10.2 million new jobs were created throughout the country's cities and townships during the first 10 months, fulfilling the goal set for the whole year. But the impacts of the ongoing global economic crisis continue to aggravate in the country's southeastern coastal regions, which abound in export-oriented enterprises. This will see the number of jobless workers increase.
However, local governments have taken a series of measures, such as extending subsidies to those who are laid off, offering them training courses and striving to create new jobs. These are expected to reduce the side effects of the crisis to a minimum. As to the international payment conditions, China has also done very well. The value of its exports in the first 10 months surpassed $1.2 trillion, or a 21.9 percent growth rate year－on－year, although the country also suffered an obvious economic slowdown due to the world financial crisis. Its forex reserve had reached $1.9 trillion by the end of September, making it the largest one in the world. However, a sound performance should not blind us to some pessimistic facets of the country's economy. Recently, the IMF lowered its forecast for this year and next year's global economic growth to 3.7 percent and 2.2 percent respectively. The world's crisis has also brought some negative effects on China's real economy. All these need greater efforts and enhanced confidence on our part to deal with possible hardships ahead. The solid economic foundation the country has built over the past 30 years and the enormous potential of its domestic market have strengthened our confidence to succeed in the fight against the global crisis. Since the reform and opening-up initiative was adopted, the material strength we have accumulated will serve as a strong prop for the country's long-term economic and social development. A well-developed network of railway, road, aviation, water and oil transportation has been in place throughout the country Also, the flexibility and sharp perception embodied in the central government's macroeconomic decision-making have also beefed up our capability to tackle complicated situations of various kinds. In a report delivered to the 17th National Congress of the Communist Party of China (CPC) Central Committee, President Hu Jintao announced the country would unswervingly cling to the reform and opening-up policy. To boost the development of the vast rural areas, the central government mapped out development directions for the underdeveloped regions in the Third Plenum of the 17th CPC Central Committee. The implementation of the long-anticipated systems on property protection, administrative management and social security as well as the pending reforms on value-added tax, oil pricing and medical care, is also expected to inject new vitality into the economy. After 30 years of opening-up, market awareness and a sense of crisis have gradually taken hold of domestic enterprises. To struggle against the emerging economic slowdown, some export-centered enterprises in coastal areas have begun to press ahead with arduous industrial adjustment and upgrading. This will stimulate their counterparts in other regions to follow suit so that they are not deserted by the changing economic situations. All these will provide an endless energy into development of the whole economy. China's relatively weak infrastructure network and its enormous population will offer a great advantage for the country to deal with the global economic crisis. Its ongoing process of industrialization and urbanization and the huge numbers of its consumers mean the country still has a wide room to expand its domestic demand. We have good reasons to believe that the proactive fiscal and the moderately loose monetary policies adopted by the central government, along with the colossal stimulus package, will help spur domestic demand, push industrial upgrading and contribute much to the country's pursuit of a steady economic growth. (For more biz stories, please visit Industries)
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