SCIO briefing on China's economy in the first three quarters
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E-mail China.org.cn, October 19, 2016
Sheng Laiyun:
4. Market sales continued to grow steadily, and the consumption of upgraded goods grew considerably.
In the first three quarters, total retail sales of consumer goods reached 23.85 trillion yuan, year-on-year nominal growth of 10.4 percent, or 9.8 percent adjusted for inflation. The growth rate increased by 0.1 percentage points over the first half of this year. Specifically, retail sales of units above designated size reached 10.83 trillion yuan, up 7.8 percent. In terms of different areas, urban retail sales totaled 20.49 trillion yuan, up 10.3 percent, and those in rural areas stood at 3.35 trillion yuan, up 10.9 percent. Grouped by consumption patterns, the total income of the catering industry was 2.56 trillion yuan, up 11.0 percent year on year; retail sales of goods reached 21.29 trillion yuan, up 10.3 percent. In particular, retail sales of units above designated size reached 10.18 trillion yuan, up 7.9 percent. The retail sales of communications and household goods increased fairly rapidly, wherein that of communication facilities grew by 12.7 percent, furniture by 13.9 percent, and building and decorative materials 15.4 percent. In September, the total retail sales of consumer goods grew by a nominal 10.7 percent year-on-year (a growth of 9.6 percent adjusted for inflation), or 0.85 percent month-on-month, with the growth rate exceeding that of the previous month by 0.1 percentage point.
In the first three quarters, online retail sales reached 3.47 trillion yuan, up 26.1 percent year-on-year. Specifically, online retail sales of goods grew 25.1 percent to 2.80 trillion yuan, accounting for 11.7 percent of the total retail sales of consumer goods.
5. The range of decline in imports and exports has narrowed and the general trade proportion has increased.
The total value of imports and exports in the first three quarters was 17.53 trillion yuan, a year-on-year decrease of 1.9 percent, the decline narrowing by 1.7 percentage points compared with the first half of this year. The total value of exports was 10.06 trillion yuan, a decline of 1.6 percent, a narrowing of 1.1 percentage points; and that of imports was 7.47 trillion yuan, down 2.3 percent, a narrowing of 2.4 percentage points. The trade surplus was 2.59 trillion yuan. In September, the total value of imports and exports was 2.17 trillion yuan, down 2.4 percent year-on-year. The total value of exports was 1.22 trillion yuan, down 5.6 percent; and that of imports 944.8 billion yuan, up 2.2 percent. The trade structure has become optimized. In the first three quarters, the general trade proportion in the total volume of imports and exports reached 56 percent, up 1.1 percentage points year-on-year. The electromechanical products accounted for 57 percent of total export volume, forming the backbone of exports. Exports from private enterprises stayed top. The value of exports from private enterprises grew up by 2.3 percent, accounting for 46.5 percent of the total value of China's exports. Exports to countries along the "Belt and Road" have increased. During the first three quarters, exports to Pakistan, Russia, Poland, Bangladesh and India increased by 14.9 percent, 14 percent, 11.7 percent, 9.6 percent and 7.8 percent respectively. Imports of some bulk commodities continued to grow. In the first three quarters, China imported 763 million tons of iron ore, 284 million tons of crude oil, 180 million tons of coal and 3.79 million tons of copper, up by 9.1 percent, 14 percent 15.2 percent and 11.8 percent respectively.
6. Consumer prices saw moderate growth, and the producer price of industrial products shows an increase year-on-year from the previous decline.
In the first three quarters, consumer prices went up by 2.0 percent year-on-year, which is 0.1 percentage points lower than the first half of the year. Specifically, prices went up by 2.0 percent in cities and 1.8 percent in rural areas. Grouped by commodity, the prices for food, tobacco, and liquor rose 4.1 percent; clothing 1.5 percent; housing 1.5 percent; household articles and maintenance services 0.5 percent. Meanwhile, the prices for transportation and communication dropped by 1.8 percent; recreation, education, culture articles and services grew by 1.4 percent; health and personal care rose 3.6 percent; other goods and service grew by 2.4 percent. In the food sector, the prices for grain grew 0.5 percent, pork 21.2 percent and fresh vegetables 12.3 percent. In September, consumer prices went up by 1.9 percent year-on-year, or 0.7 percent month-on-month. In the first three quarters, producer prices for industrial products dropped by 2.9 percent year-on-year, and the decline narrowed by 1.0 percentage point compared with the first half of the year. In September, there was an increase of 0.1 percent year-on-year, or 0.5 percent month-on-month. In the first three quarters, purchasing prices for industrial producers fell 3.8 percent year-on-year. In September, the price was down by 0.6 percent year-on-year, or up 0.4 percent month-on-month.
7. Incomes maintained steady growth, and the gap between urban and rural areas keeps narrowing.
In the first three quarters, national per capita disposable income was 17,735 yuan, a nominal growth of 8.4 percent, or a real increase of 6.3 percent after deducting price factors. In terms of permanent residence, the per capita disposable income of urban households was 25,337 yuan, a nominal growth of 7.8 percent, or real growth of 5.7 percent. The per capita disposable income of rural residents was 8,998 yuan, up 8.4 percent in nominal terms, or 6.5 percent in real terms. The per capita income of urban households was 2.82 times that of rural households, a decrease of 0.01 when compared with the same period of the previous year. The median national per capita disposable income was 15,626 yuan, a nominal increase of 8.1 percent. By the end of the third quarter, the number of rural migrant workers stood at 176.49 million, an increase of 950,000 compared to last year, up 0.5 percent. In the third quarter, the average monthly income of migrant workers was 3,232 yuan, up 5.9 percent year-on-year.
8. The supply-side structural reform made headway, and the economic quality and performance have been steadily improved.
Much headway has been made concerning the five major tasks, which are cutting industrial overcapacity, destocking, de-leveraging, lowering costs and improving weak links. In the first three quarters, the output of raw coal dropped by 10.5 percent year-on-year. Industrial enterprises and housing stock showed a steady decline. At the end of August, the finished goods inventory of industrial enterprises above designated size dropped by 1.6 percent year-on-year. The figure dropped for five consecutive months from April. The area of housing 'waiting for sale' kept decreasing for seven consecutive months from March. The debt ratio and cost of industrial enterprises both dropped. At the end of August, the debt ratio of industrial enterprises above designated size was 56.4 percent, down 0.6 percentage points from the same period last year. From January to August, the cost per 100-yuan main business revenue of industrial enterprises above designated size was cut down 0.17 yuan from the same period last year. In the first three quarters, investment in ecology conservation and environmental protection rose by 43.4 percent, water management 20.5 percent, and agriculture, forestry, animal husbandry and fishery 20.1 percent, up respectively 35.2, 12.3 and 11.9 percentage points compared to the growth of total investment.
The industrial structure was upgraded steadily. In the first three quarters, the added value of the tertiary industry was 52.8 percent of the country's GDP, up 1.6 percentage points year-on-year, or 13.3 percentage points higher than that of the secondary industry. The demand structure continued to improve. In the first three quarters, the final consumption expenditure contributed 71.0 percent to the country's GDP, up 13.3 percent points year-on-year. The new economy grew rapidly. In the first three quarters, new strategic industry grew up 10.8 percent over last year. The growth rate was 4.8 percentage points higher than industrial enterprises above the designated size. Saving energy and reducing consumption became more efficient. Energy consumption per unit of GDP dropped by 5.2 percent year-on-year. The consumption proportion of clean energy such as hydropower, wind power, nuclear power and gas reached 19.3 percent, up 1.7 percentage points year-on-year.
While adhering to the policies of appropriately expanding demand and supply-side structural reform, the national economy saw solid development in the first three quarters of 2016. However, we must be aware that China is at a critical stage for economic transformation and upgrading as well as replacing old engines of growth with new ones, and domestic and international uncertainty still exists. For the next step, we must adhere to the concepts of innovation to adapt the economy to the 'new normal' stage, strengthen supply-side structural reform, appropriately expand demand, maintain a proper balance between ensuring steady growth, promoting reform, making structural adjustments, improving living standards, and guarding against risks, and work to reach the growth target for the whole year.
That completes the major economic data for the first three quarters. Now, I'm ready to answer your questions.
Hu Kaihong:
The floor is open. Please identify which media outlet you represent when asking a question.
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