SCIO briefing on China's economic performance in 2020
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E-mail China.org.cn, January 20, 2021
Bloomberg:
We have two technical questions. I'm wondering what the breakdown is for the contribution to growth from net exports, consumption, and investment? Were also interested in when China's birth rate figure will be released? Thank you.
Ning Jizhe:
Just now I mentioned that investment, consumption, and exports are referred to as a troika of growth, and you brought up a direct question. We will announce the breakdown of the troika tomorrow. To evaluate the impact of the three major demands on the economy, I would like to first introduce the total amount.
First, in terms of total volume, the final consumption rate in 2020 was close to 55%. From 2011 to 2019, China's consumption rate averaged 53.4%. Despite the impact of the coronavirus in 2020, the final consumption expenditure still accounted for 54.3% of GDP, 11.2 percentage points higher than the total capital formation, the highest proportion in recent years. Consumption is still the anchor of a stable economy.
Second, from the perspective of incremental growth, the role of consumption in stimulating economic growth has also increased each quarter. With the steady recovery of China's economic operations, consumptions driving force on economic growth has increased quarter by quarter. In the fourth quarter, the total retail sales of consumer goods increased by 4.6% year on year, and the growth rate was 3.7 percentage points higher than that in the third quarter; and final consumption growth drove economic growth by 2.6 percentage points, an increase of 1.2 percentage points from the third quarter. As the epidemic is more effectively controlled, the momentum of consumer demand will be further restored. The contribution rate of net exports of the trade in goods and services to economic growth during the past year had still been positive. Now, in order to measure the impact of imports and exports on economic development, we should not only look at the growth rate or contribution rate, but also the total amount. First of all, incremental growth has been a positive contributing factor. Looking at the total amount, the total import and export volumes are equivalent to the proportion of China's GDP, which is relatively high among major countries, accounting for more than 30%. Major countries generally focus on domestic demand. Under open conditions, in order to achieve economic circulation, China's proportion is higher than that of strong economies such as the United States and Japan. Therefore, considering the two aspects, the role of imports and exports is still relatively important.
Economic growth depends on domestic demand, which conforms to the laws of economic development. The construction of a new dual-circulation development pattern requires better use of the advantages of the domestic super-large-scale market in China's opening-up. Looking at China's situation, there is still a lot of room for improvement in utilizing the fundamental role of consumption. The average contribution rate of final consumption expenditure to economic growth was around 60% from 2013 to 2019. If compared with the levels of 70% and 80% for developed economies, there is still much room for improvement. As the development stages are different, it is necessary to improve people's consumption abilities, improve consumption policies, improve the consumption environment, and find more areas for consumption growth. Utilizing the key role of investment is also very important. In 2020, investment played an active role in promoting economic recovery. Going forward, we must increase the intensity of effective investment and transform China's relatively high national savings rate into actual investment results. At the same time, we must unswervingly expand opening-up and make better use of the active role of the "three drivers of growth" consumption, exports and investment in building a new dual-circulation development pattern.
Just now, you asked about the population. The seventh national population census was launched on Nov. 1 last year. More than 7 million census takers went into communities, urban and rural areas. After much hard work, on-site registration has now been completed and the process of carrying out random quality checks and verifications, as well as preliminary summary is now underway. The census is conducted once every 10 years, and the previous sixth census was also conducted in November, with the results released in April of the following year. The results of this year's census will also be announced to the whole society in April. As such, we cannot provide the data today. I hope you can understand.
The fifth plenary session of the 19th CPC Central Committee has put forward requirements for population development strategies and policies for the next five years. The statistics departments will ensure the population data is true, accurate and reliable through population censuses and daily surveys, and provide a scientific basis for formulating strategic planning policies for population development. Thank you.
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