Hu Kaihong:

Ladies and gentleman, good morning. Welcome to this press conference hosted by the State Council Information Office. The economic data for the third quarter have been issued recently. Today we invite Mr. Sheng Laiyun, spokesperson for the National Bureau of Statistics and Director-General of the Department of Comprehensive Statistics under the National Bureau of Statistics, to give a briefing on China's economic performance during the first three quarters of 2014 and take your questions. Now let's welcome Mr. Sheng to give us a brief introduction.

Sheng Laiyun:

Ladies and gentlemen, friends from the press, good morning. I'm delighted to see you again. I will first brief you, as we usually do, on the major economic indexes and data from the first three quarters of 2014 and then take your questions.

In the midst of complex national and international situations, the Chinese Communist Party Central Committee and the State Council have grasped the overall situation and the major trends, stuck to the guiding principle of making headway on the basis of stability while continuing to pursue reform and innovation, scientifically coordinated the issues of stabilizing economic growth, promoting reform, adjusting structure, ensuring the people's well-being and preventing risks, and are more attentive to directional adjustment and control on the basis of keeping the normal growth range. The national economy is generally stable and it is growing with improved quality under the "new norm." Preliminary statistics show that the GDP in the first three quarters of 2014 reached 41,990.8 billion yuan, a year-on-year increase of 7.4 percent. In the first quarter it increased by 7.4 percent, the second quarter 7.5 percent, and the third quarter 7.3 percent. As to the industries, the added value of the primary sector has reached 3,799.6 billion yuan, a year-on-year increase of 4.2 percent. The secondary industry generated 18,578.7 billion yuan, an increase of 7.4 percent, and the tertiary industry 19,612.5 billion yuan, an increase of 7.9 percent. The GDP of the first three quarters of 2014 increased by 1.9 percent compared to that of the last three quarters.

First, the agricultural industry is developing soundly. China's summer grain crops yielded 136.6 million tons, an increase of 4.75 million tons, or 3.6 percent, from last year. Early season rice has had an output of 34.01 million tons, decreasing 125,000 tons, or 0.4 percent, from last year. The autumn grain crops are expected to see good yields. The output of pigs, cattle, sheep and poultry are 59.75 million tons for the first three quarters of this year, a year-on-year increase of 2 percent. Pig meat reached 39.72 million tons, an increase of 3.3 percent.

Second, industrial production is generally stable. The output of industrial enterprises above the designated size (enterprises that have a yearly revenue above 20 million yuan) registered a year-on-year increase of 8.5 percent for the first three quarters of 2014, but the growth rate declined 0.3 percentage points compared to that of the first half of this year. In terms of different enterprise types, national and state-owned companies posted a year-on-year increase of 5.2 percent, collectively-owned enterprises an increase of 2.6 percent, joint-equity enterprises an increase of 9.9 percent, and foreign, Hong Kong, Macao and Taiwan-owned enterprises an increase of 6.7 percent. Seen from the three major categories, the mining industry saw an increase of 4.8 percent, the manufacturing industry an increase of 9.6 percent, and electricity, heating, gas and water production and supply 3.1 percent. In terms of the three regions, eastern China saw a year-on-year increase of 8.0 percent, the central region an increase of 8.5 percent, and the western region an increase of 10.6 percent. In terms of products, 346 out of 464 types of products registered growth in their output. The sales-output ratio of industrial enterprises above the designated size was 97.7 percent in the first three quarters of 2014, an increase of 0.2 percent compared to the first half of this year. The value of export delivery of industrial enterprises above the designated size reached 8,748.3 billion yuan, a year-on-year increase of 6.4 percent. During September, industrial enterprises above the designated size registered a year-on-year increase of 8.0 percent, and a month-on-month increase of 0.91 percent.

Industrial enterprises above the designated size yielded a profit of 3,833 billion yuan from January to August, a year-on-year increase of 10.0 percent. The main business generated a profit of 3,587 billion yuan, an increase of 9.6 percent. The cost of every 100 yuan of main business at industrial enterprises above the designated size was 86.06 yuan, a margin of 5.52 percent.

Third, the growth rate of fixed-asset investments (excluding rural households) is slowing down. Fixed-asset investments (excluding rural households) stand at 35,778.7 billion yuan, a nominal year-on-year increase of 16.1 percent (an actual increase of 15.3 percent after adjusting for inflation). The growth rate slid 1.2 percent from the first half of this year. National and state-owned enterprises invested a total of 11,236.9 billion yuan, an increase of 14.1 percent, while private investment totaled 23,150.9 billion yuan, an increase of 18.3 percent, accounting for 64.7 percent of total investment. In regard to the three regions of China, investment in the east increased by 14.9 percent year-on-year, investment in the central region increased by 17.8 percent, and investment in the west increased by 17.9 percent. Investment in the primary sector reached 864.2 billion yuan, an increase of 27.7 percent; investment in secondary industry was 15,018 billion yuan, an increase of 13.7 percent; and investment in tertiary industry was 19,896.5 billion yuan, an increase of 17.4 percent. Regarding the funds actually available, the first three quarters of 2014 saw a total investment of 39,114.1 billion yuan, a year-on-year increase of 12.4 percent, including 14.1 percent growth in national budget, 11.2 percent growth in domestic loans, 16.1 percent increase in self-raised funds, and 7.0 percent decrease in foreign investment. Newly-initiated projects in the first three quarters received total investments of 30,272.9 billion yuan, a year-on-year growth of 14.4 percent. Fixed-asset investments (excluding rural households) in September posted an increase of 0.77 percent over August.

Investment in real estate development reached 6,875.1 billion yuan during the first three quarters, a nominal year-on-year increase of 12.5 percent (an actual growth of 11.7 percent after adjusting for inflation). Investment in residential housing has increased by 11.3 percent. Construction has started on a total of 1.314 billion square meters of residential space, registering a year-on-year decrease of 9.3 percent. The total number of newly-commenced residential units decrease by 13.5 percent. 771.32 million square meters of real estate was sold commercially, a year-on-year decrease of 8.6 percent, and the total area of residential real estate sold posted a decrease of 10.3 percent. The total sales of commercial residential buildings stand at 4,922.7 billion yuan, a year-on-year decrease of 8.9 percent, and the sales of residential real estate decreased by 10.8 percent. Property development companies acquired 240.14 million square meters of land, a year-on-year decrease of 4.6 percent. 571.48 million square meters of commercial houses were for sale as of the end of September, a year-on-year increase of 28.0 percent. Actual funds available for property development enterprises reached 8,986.9 billion yuan, a year-on-year increase of 2.3 percent.

Sheng Laiyun:

Fourth, the consumer market is growing steadily. The total retail sales of consumer goods reached 18,915.1 billion yuan, a nominal year-on-year increase of 12.0 percent (an actual increase of 10.8 after adjusting for inflation), 0.1 percent lower than the growth rate posted in the first half of this year. Among consumer goods, retail sales of units of consumer goods above the designated limits reached 9,423.3 billion yuan, an increase of 9.5 percent. The retail sales of consumer goods in cities and towns reached 16,313.2 billion yuan, a year-on-year increase of 11.9 percent. The retail sales of consumer goods in villages was 2601.9 billion yuan, an increase of 13.0 percent. The food service industry generated 1,993.4 billon yuan in revenue, a year-on-year increase of 9.7 percent; commodities retail generated 16921.7 billion yuan in revenue, an increase of 12.3 percent. The retail sales of commodities above the designated units reached 8841.4 billion yuan, an increase of 10.1 percent. The total retail sales of consumer goods increased by a nominal 11.6 percent year-on-year (an actual growth of 10.8 percent after adjusting for inflation) in September, an increase of 0.85 percent over August.

Online retail sales for the first three quarters stood at 1,823.8 billion yuan, posting a year-on-year increase of 49.9 percent. The retail sales of goods above the designated units reached 288.8 billion yuan, an increase of 54.8 percent.

Fifth, the growth rate of imports and exports rose. The total volume of foreign trade was 19,422.3 billion yuan (US$ 3,162.6 billion) during the first three quarters, a year-on-year increase of 3.3 percent. The growth rate in foreign trade during this period was 2.1 percent higher than that in the first half of this year. Exports were valued at 10,422.4 billion yuan (US$ 1,697.1 billion), an increase of 5.1 percent, while imports were valued at 8,999.8 billion yuan (US$ 1,465.5 billion), an increase of 1.3 percent. The trade surplus reached 1,422.6 billion yuan (US$231.6 billion), posting a year-on-year increase of 11.3 percent. The total volume of foreign trade in September was 2,441.7 billion yuan (US$ 396.4 billion), representing a year-on-year increase of 11.3 percent. Exports reached 1,315.9 billion yuan (US$ 213.7 billion) that month, an increase of 15.3 percent; while imports reached 1,125.8 billion yuan (US$ 182.7 billion) for an increase of 7.0 percent.

Sixth, consumer prices are generally stable. In the first three quarters of the year, consumer prices increased 2.1 percent year-on-year, while the growth rate in consumer prices decreased by 0.2 percent compared to the first half of this year. Consumer prices rose by 2.2 percent in cities and 1.9 percent in rural areas. Food prices rose by 3.3 percent year-on-year, tobacco and liquor prices decreased by 0.6 percent, clothing prices increased by 2.4 percent, household appliances prices and the costs of related maintenance rose by 1.2 percent, prices for healthcare and personal items increased by 1.2 percent, traffic and telecommunication costs rose by 0.1 percent; prices for entertainment, education, cultural products and their related services rose by 2.2 percent, and housing prices rose by 2.3 percent. Among food prices, grain prices rose by 3.1 percent, cooking oils prices decreased by 5.0 percent, pork prices dropped 4.5 percent, and vegetable prices decreased by 1.3 percent. In September, consumer prices increased by 1.6 percent year-on-year, an increase of 0.5 percent compared to August. The production prices of industrial goods decreased by 1.6 percent in the first three quarters, posting a year-on-year increase of 1.8 percent in September and a 0.4 percent decrease compared to August. The purchase prices of industrial products decreased by 1.8 percent in the first three quarters, posting a year-on-year decrease of 1.9 percent for September and a 0.4 percent decrease compared to that for August.

Seventh, residents' incomes have grown steadily. The average cash income of rural residents was 8,527 yuan in the first three quarters, representing a nominal year-on-year increase of 11.8 percent and an actual increase of 9.7 percent after adjusting for inflation. The average disposable income of urban residents was 22,044 yuan, a nominal year-on-year increase of 9.3 percent and an actual increase of 6.9 percent after adjusting for inflation. According to a survey of the integration of urban and rural residents, the average disposable income for both groups during the first three quarters was 14,986 yuan, a nominal year-on-year increase of 10.5 percent and an actual increase of 8.2 percent after adjusting inflation. The median disposable income was 13,120 yuan, a nominal year-on-year increase of 12.1 percent. The number of rural migrant workers reached 175.61 million as of the end of September, a nominal year-on-year increase of 1.69 million people and an increase of 1.0 percent. The average monthly income for rural migrant workers was 2,797 yuan, an increase of 10.0 percent.

Eighth, structural adjustments have made headway. The country's industrial structure has improved. The added value of tertiary industry in the first three quarters comprised 46.7 percent of the total GDP, a year-on-year increase of 1.2 percent. The proportion of tertiary industry's contribution to total GDP is also 2.5 percent higher than that of secondary industry. The supply structure also continues to be improved. Final consumption expenditures in the first three quarters contributed 48.5 percent to the growth of GDP, a year-on-year increase of 2.7 percent. The gap between urban and rural residents has narrowed. The actual growth of the average cash income of rural residents is 2.8 percent higher than that of the average disposable income of urban residents, while the average disposable income of urban residents is 2.59 times that of the average cash income of rural residents, a decrease of 0.05 year-on-year. Furthermore, new progress has been made in saving energy. Energy consumption per unit of per capita GDP declined 4.6 percent year-on-year.

Ninth, credit and loans have increased steadily. At the end of September, the broad money (M2) balance reached 120.21 trillion yuan, a year-on-year increase of 12.9 percent. The narrow money (M1) balance was 32.72 trillion yuan, an increase of 4.8 percent. Money in circulation (M0) had a surplus of 5.88 trillion yuan, an increase of 4.2 percent. The RMB loan balance was 79.58 trillion yuan, and RMB deposit balance was 112.66 trillion yuan. New RMB loans added up to 7.68 trillion yuan during the first three quarters, posting a year-on-year increase of 404.5 billion yuan. New RMB deposits reached 8.27 trillion yuan, a year-on-year decrease of 2.99 trillion yuan. Social financing was valued at 12.84 trillion yuan in the first three quarters, a year-on-year decrease of 1.12 trillion yuan.

Overall, the national economy in the first three quarters of 2014 continued in a state of general stability with both growth and improved quality. But the situation both inside and outside of China is still complex, posing a number of difficulties and challenges for economic development. In the next stage to come, we will earnestly implement policies made by the CPC Central Committee and the State Council, scientifically examine and proactively adapt to the "new normal," devote ourselves to reform and innovation, transformation and upgrading, and the improvement of people's well-being. We will also continue with current macroeconomic policies while appropriately fine-tuning them in order to realize stable and healthy economic development.

This is my full report. Now I'm ready to answer your questions.

Hu Kaihong:

Thanks Mr. Sheng. Now the floor is open. Please indicate which media outlet you are from.

CCTV:

I have two questions for Mr Sheng. GDP expanded by 7.3 percent in the third quarter, versus 7.5 percent in the second quarter. What do you think are the reasons behind the slower growth rate, and what is your evaluation of China's economy in the first three quarters of this year? Thank you.

Sheng Laiyun:

About the economic situation during the first three quarters of this year, I want to put forward the following points:

First, the employment rate and commodities prices remain stable, and the economy is still running within a reasonable growth range, although economic growth has been slower. GDP had expanded by 7.4 percent over the first three quarters and increased by 7.3 percent in the third quarter, which is indeed lower than last year. But the employment situation has been optimistic this year, with more than 10 million urban jobs created from January to September, and we have achieved the annual goal we set for employment in 2014. CPI rose by 2.1 percent from January to September, remaining stable in general. These indicators show that China's economy is still running within a reasonable range even though GDP growth has dipped. Today, the international landscape is complex and volatile, and there is a lot of pressure from our special economic situation, so it is not easy to ensure stable economic performance.

Second, there are many reasons for the slower economic growth of the third quarter. One is that the baseline established last year is relatively high, and another more important reason is the pressure from the special economic situation and structural adjustments in China. Excess production capacity in traditional industries has been one of the problems of structural adjustments, and this remains a major challenge. The accumulative effects of constant adjustments in the real estate sector have been increasing. These two factors will impact production, consumption and investment in related companies in the short term.

Third, although GDP growth has been slower, structural adjustments have improved, and the transformation of the economy has been going according to plan. In terms of the general economic situation, we have been making progress while ensuring stability.

In fact, if we look at things from a different perspective of "new norm," we can see that China's economy has been experiencing great and profound changes.

First, a new breakthrough in the industrial structure is expected. The statistics I just presented show that the proportion of the tertiary industry's overall contribution to the economy has continued to rise, and the value-added production of the service sector has grown faster than that of industry for the first time. Adjustments to the industrial structure have been accelerated and new industries, new businesses and new products have been growing quickly, and the overall economy has improved.

Second, there are positive changes in the demand structure. Investment growth has slowed this year and export growth has also changed, but consumption has continued to play a much bigger role in fueling economic growth. Consumption contributed 48.5 percent of GDP growth in the first three quarters, about 7 percentage points higher than the contribution of gross capital formation. We can see a clear trend of economic rebalancing.

Third, the structure of income distribution has been improved. Incomes of both rural and urban residents increased rapidly in the first three quarters. The per capita disposable income of residents rose by 8.2 percent, 0.8 percentage points higher than GDP growth. Moreover, nominal household income grew faster than government revenue that is recorded to have grown at 8.1 percent in the first three quarters, higher than the growth rate of enterprises' profits. This indicates that national income is accounting for a greater proportion of the primary distribution of income. The urban-rural income gap has also continued to narrow. The medium growth of resident income outpaced the average growth, which indicates the gap between rich and poor has also narrowed.

Fourth, regional infrastructure has been improved, and development in different regions has become more balanced. The eastern region continued to lead and become more important in structural adjustments and economic transformation. The central and western regions continue to enjoy distinct advantages promoted by a series of regional development strategies.

Fifth, resource and environmental costs have been reduced. The growth model has shifted greatly from an inefficient and unsustainable one to an intensive one. Energy consumption per unit of GDP went down by 4.6 percent in the first three quarters of this year.

I think that the five changes I just listed can be regarded as highlights of the economic development of this year and as the new trends in structural adjustment and upgrading. When we look at the economy from this point of view, although GDP growth has been slower this year, we believe that the structure and quality of economic growth have improved, new engines of economic growth have formed and new economic sectors have been growing rapidly, indicating that China's economy has continued to go in the right direction. We should foster and guide the new trends and further strive to make progress, and improve quality while ensuring stability.

Phoenix TV:

We have noticed that China's Consumer Price Index rose by 2.1 percent year-on-year during the first three quarters of this year with a remarkably slower growth rate -- 1.6 percent -- in September. Experts and scholars have said this could be an early sign of deflation. Can you please comment on this opinion? Thank you.

Sheng Laiyun:

Deflation generally means there is not enough currency in circulation, which may cause prices to continuously drop. But as we have continued to implement a prudent monetary policy this year, currency circulation in China has maintained steady growth. The September PBC data showed M2 growth for that month was 12.9 percent, while the CPI for the same month only rose by 1.6 percent, dropping from 2 percent.

The primary reason for this was the relatively higher baseline established during the same period last year, which diminished the carryover effects for this year. But in fact, prices are still going up in a mild way. Compared with August, prices in September went up by 0.5 percent. In general, prices are stable with a mild upward momentum.

In the upcoming months, the carryover effect, the arrival of winter, and the demand-supply rates for certain food products will keep the CPI at a level that can maintain mild growth. To sum up, we don't think there are sufficient grounds to call this a sign of deflation.

Global Times:

My first question is that, according to currently available statistics, can you predict the economic performance in the fourth quarter, and is the goal of 7.5 percent economic growth for the whole year attainable? It is reported that the central bank has injected 200 billion yuan into the market to increase liquidity. So, my second question is: is this news true, and will there be any massive economic stimulus policy brought forward in the future?

Sheng Laiyun:

Regarding the economic performance in the fourth quarter, I believe it is more likely that the overall economy will maintain steady and rapid development. As China is now in a period of great strategic opportunities, the conditions and potential for stable economic development are quite strong.

First, China has not completely industrialized or urbanized yet. Industrialization, urbanization, IT application and agricultural modernization – the four new "modernizations" – still can give new impetus to economic growth. Second, the advantages of the central and western regions' later development will continue to come into play. Third, China is in a critical stage of upgrading its consumption structure, and the development of entertainment consumption will continue to provide new impetus to economic growth. Fourth, the new central government has constantly strengthened the reforms. Reform and innovation will also give new impetus to economic development. Particularly since the beginning of this year, the government has introduced a series of policies and measures that focus on both current and long-term development, which have continued to create positive economic effects. From all these aspects, it is more likely that the economy will maintain steady and rapid development in the fourth quarter of this year and in the future.

At the same time, we must also note that the Chinese economy is in a crucial stage of structural adjustment, transformation and upgrading. New and traditional driving forces have reached a stalemate. Traditional economic forces are still relatively powerful, and even though new forces are related to faster speeds of economic growth, their import is relatively small. So there is still quite heavy downward pressure on economic development. This being the case, we should strengthen reforms and structural adjustments and in the meantime, we should preset and fine tune the economy to keep economic growth within a rational and proper range, which helps create a stable environment for future reform and structural adjustment.

China News Service:

I have questions about the quality of statistics. The National Bureau of Statistics of China is currently seeking opinions on the Interim Procedures for Informing the Public about Enterprises Statistically Losing Credit. How should this be carried out? The draft for comment states that the records of enterprises losing credit are linked to capital financing, registering for industrial and commercial administration and government subsidies. How can this procedure be carried out? Thank you.

Sheng Laiyun:

The National Bureau of Statistics has recently developed the Interim Procedures for Informing the Public about Enterprises Statistically Losing Credit in order to promote statistics with integrity and fundamentally improve the quality of essential statistical data. The procedure has been released on the bureau's website and is seeking public opinions. The invitation for public comments was released on Oct. 8, and the comment period is one month, it will last until Nov. 8. After that period, we will ask for advice from people from all social circles, further improve the procedures and put this into practice as soon as possible.

In the first part of this year, the State Council distributed the Program for Forging the Social Credit System (2014-2020) in order to promote a society with integrity. The program clearly identified promoting credit construction in the field of statistics, establishing an open system on a permanent basis for enterprises violating statistics law and registering unjustly. Moreover, the procedure also put forward that the file of enterprises without integrity will be linked with the credit systems of industry and commerce departments, tax authorities and banks. That is, those credit records will be linked to capital financing, government subsidies and items involving statutory industrial and commercial registration. I think the practice (of linking credit records with future commercial activities) is a requirement for developing statistics with integrity, and it also points out the direction. So, following the requirement of the Program, the NBS formulated the interim procedures. It is also good for increasing the quality of the essential statistical data.

During the process of formulating the procedures, we consulted the People's Bank of China, industrial and commercial departments, tax authorities, and the Legislative Affairs Office of the State Council. They all gave us strong supports. Formulating the procedures is a requirement of implementing the strategy of governing the country by law and performing official duties lawfully. The statistics law explicitly demands that deceptive statistics practices should be severely punished, in order to leave the enterprises with integrity unobstructed and those losing credit difficult even to move one step. And the costs of illegality will be huge.

We hope that people from all social circles including the media will strengthen supervision and increase the credibility of the statistics and speed up the progress of credit construction through concerted efforts.

Financial Times:

As the labor market in China is getting tighter, can you comment on whether China has reached the Lewis Turning Point? If not, when will that be? And my second question is, will China introduce any labor-oriented policies if GDP growth drops too quickly?

Sheng Laiyun:

The past two years have seen some changes in China's demographics. The labor force aged between 15 and 59 is both shrinking in number and its proportion of the entire labor force. This has caused some changes in the supply-demand relationship in China's labor market. In 2012, when China announced the details of its labor resources for the first time, the working population aged between 15 and 59 was 3.45 million less than one year earlier. In 2013, the working population aged between 16 and 59 shrank by 2.44 million. This year, the number of people in work continued to reduce in the changing demographic structure, meaning that the structure of labor resources is undergoing fundamental changes.

This change will cause two direct consequences. First, the cost of labor, including the costs in hiring rural workers, continues to rise. This explains why rural workers' incomes have been rising over the past few years; even this year, when GDP growth slowed down, the average income for migrant workers increased by 10 percent year on year.

Second, it eases pressure on employment. Employment turned out better than expectations, and it maintained steady growth despite a slowdown in GDP. Apart from expanding the economy, in particular the growth of the service sector and the changing supply-demand relationship in the diminishing labor resources are also factors.

We believe the change represents a trend, and will be a new norm when the Chinese economy enters a new development stage. The structural change of the labor force will directly influence the economic restructuring and the change of development mode. From this point of view, although the economic slowdown has caused some pressure on employment, the changes in supply-demand relations and in the industrial structure will make such unemployment pressure bearable, because the economy as a whole is capable of providing more jobs.

China Profiles:

Currently, the steel industry is facing a lot of problems, and many are even saying that it is less profitable to sell a ton of steel than to sell a bottle of water. Could you tell us what the problem in the real economy is and what effect this has had on the entire national economy? Thank you!

Sheng Laiyun:

Recently, the price of bulk raw materials has dropped quite significantly. This year, the prices of coal, steel and nonferrous metals have fallen continuously. For example, the price of rebar has fallen to 3,000 yuan per ton. That's why some media say that it is more profitable to sell a kilo of cabbage than a kilo of steel. Why did this happen? The main reason is supply exceeds demand. From the perspective of consumption, as the real estate economy has returned to normal, the demand for steel has declined gradually. The data from the China Iron and Steel Association shows that steel production capacity has surpassed one billion tons, while the demand is only 700-800 million tons. So, when supply exceeds demand, prices will surely drop.

This is also true for other related industries. Therefore, the entire national economy is facing a problem of over-capacity. Because some companies are continuing to release production capacity, even though there is a surplus in steel for example, we still have to produce it in order to share fixed costs. Thus, it is more difficult and will take longer time to reduce capacity or stock. That's why when prices of bulk raw materials drop, the Producer Price Index grows negatively.

With this situation in mind, we have to promote reducing production capacity under the guidance of the CPC's Central Committee and the State Council on the one hand while steel companies respond to the market and adjust their structures actively on the other hand. I believe this is a necessary stage in the Chinese economy's adjustment and transform. Ultimately, we can only deal with the problem of over capacity if we do those two things.

Dragon TV:

I have a question about the property market. At the last press conference, I learned that there was a differentiation emerging between first-tier cities and the second- and third-tier ones. In the last few months, many cities have loosened their policies on purchase restrictions. According to NBS statistics, are those policies effective? And how do you see the current property market?

Sheng Laiyun:

On Oct. 24, we will release the September house price data of 70 cities. I haven't yet seen the latest figures. However, based on data of property investment and observations in some cities, the tendency of differential adjustments to the property market is continuing and the market is operating stably as a whole.

By saying "stably as a whole", I mean that the adjustments have been relatively moderate. Third- and fourth-tier cities have made relatively big adjustments. Some local governments have loosened the purchase control since the third quarter and the central bank also issued new regulations on loan limits on Sept. 30.

Based on incomplete observations, the property market made positive progress in September, which is reflected in a recovery in sales and reductions in price drops. Of course, it takes time for policies to take effect. We will continue to pay attention to market fluctuations. The recent easing policies on property in some places have been regarded as a bailout measure in many media reports. In my opinion, that means we are becoming more market-oriented. In the past, the property market was controlled mainly through administrative measures. The new policies enable the market to adjust by itself and reduce administrative interference. They are in line with the direction of our reform.

Although the property industry is very important and has special characteristics, it still needs structural adjustment and transformation of the development mode through market regulation, like any other industry. Therefore, if the market can play a bigger role in adjustment, the market structure can be optimized and the real estate industry will have stable and healthy development in the long run, which will be conducive to the sustainable growth of China's economy.

Hu Kaihong:

Today's conference ends here. Thank you.

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