SCIO briefing on China's current economic performance
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E-mail China.org.cn, July 28, 2017
CNR:
As a vital part of regional economy, economic development of northeastern China has drawn a lot of attention in recent years. In particular, as Mr. Yang Weimin just mentioned, economic development there saw a recovery this year after touching bottom. Could you talk about China's economic development in the first half of this year from the perspective of regional development? What's more, will this recovery in the northeast be sustainable? Thanks.
Cong Liang:
As we have mentioned before, due to various factor endowments and geographic conditions among regions, their development differs from each other. However, this year, guided by the new development philosophy, the eastern, central, western and northeastern regions interacted and coordinated well. Economic development of eastern China maintained a good and powerful momentum. The economy of central and western China grew steadily, and the northeast underwent a recovery.
As the leading region of the country, eastern China contributes over 50 percent of the total national economy. In the first half of the year, the growth of industrial value added in the top five provinces - Jiangsu, Guangdong, Shandong, Henan and Zhejiang - all surpassed the national average, thus providing a steady base for China's economy. Especially, the transformation and upgrading carried out in eastern China played a vital role in leading the economy. In Zhejiang Province, the high technology and equipment manufacturing industries contributed over 50 percent of industrial growth. And in Jiangsu Province, 3D printing and industrial robots saw a growth rate of 70 percent. Some cities have achieved a lot during their transformation and upgrading. For example, in Shenzhen, its per capita GDP is over US$25,000, so it has avoided being caught in any "middle income trap." And its GDP growth, featuring high quality, great benefits and advanced technology, reached 8.8 percent in the first half of this year. Through these facts, we could see China's great economic development capability and potential.
Regarding the central and western regions, their development index is higher than the whole country, indicating they have gained obvious advantages as late comers. Over the last two years, with industry relocation and technology transfer from the eastern regions, the central and western regions saw their industry grow at a rather high rate.
Many provinces enhanced growth momentum by raising the quality and returns of development, and promoting industrial upgrading. For example, in Shanxi and Shaanxi provinces, after cutting excessive industrial capacity and treating zombie enterprises, the total corporate profit increased by 30 percent, much faster than the whole country. In Hunan province, which encouraged its equipment manufacturing industry to integrate with the software industry, the growth rate of the equipment manufacturing industry was double that of the industrial sector as a whole. In Anhui province, the growth rate of strategic emerging industries was over 20 percent, which is common in the central and western regions.
In the northeast region, the pressure of economic growth has been high in recent years. But from this year, the signs of stability are increasing. The growth rate of industry was 1 percent in the first half of the year. Last year, it decreased 3.1 percent. The drop in investment has slowed down. Meanwhile, some key industries are improving in terms of profitability. In previous years, the petroleum and petrochemical sector, including the mining industries, experienced great losses, but their profitability have markedly improved now.
Meanwhile, proactive efforts have been made to promote the three key initiatives: the Belt and Road Initiative, the coordinated development of Beijing, Tianjin and Hebei, and the development of the Yangtze River economic belt. Much headway has been made in promoting the Belt and Road Initiative. Steady progress has been made in the coordinated development of the Beijing-Tianjin-Hebei region, and in the projects to relieve Beijing of functions nonessential to its role as China's capital. The development of the Yangtze River economic belt is centred upon environmental protection, and the restoration of the whole ecological environment has achieved substantial results. Overall, the coordinated and integrated development between regions is clearly progressing well. New growth poles and growth belts are gradually forming. Deep-rooted problems in some regions are gradually being solved, and some have achieved obvious improvement. Thank you.
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