Original title: Optimistic semi-annual report goes well in the second half
The results of the “Interim Volume” for the first year of the “14th Five-Year Plan” have been released. In the first half of the year, GDP grew by 12.7% year-on-year, down 5.6 percentage points from the first quarter, and grew by an average of 5.3% over the two years.
Does the quarterly growth slowdown mean that China’s economic momentum is weakening? the answer is negative.
What needs to be clear is that the diminishing effect of low base is an important factor. In 2020, the sudden new crown pneumonia epidemic will bring unprecedented impact to the development of our country. In the first quarter of last year, GDP fell by 6.8% year-on-year, and in the second quarter it rose from a decline to 3.2%. The GDP growth rates in the third and fourth quarters were 4.9% and 6.5% respectively. Based on the fact that last year’s base figure was “low before and high”, the year-on-year growth rate of this year’s quarter is likely to be “high before and low”.
To analyze the situation scientifically and grasp the general trend of development requires a comprehensive, dialectical, and long-term perspective. The current global epidemic and the international environment are complex and severe. To accurately grasp my country’s economic situation and basic trends, it is necessary to look at the situation and see the trend, both vertical and horizontal comparisons, and both the year-on-year growth rate and the combination of two years. Comprehensive research and judgment of indicators such as average growth rate, month-on-month growth rate, structural optimization, and economic development quality and benefit.
Generally speaking, since this year, my country has coordinated efforts to promote epidemic prevention and control and economic and social development. The macro policies have maintained continuity, stability and sustainability, and the necessary support for economic recovery. The main macro indicators are in a reasonable range, and economic development is showing steady progress. To strengthen and stabilize the positive trend, many international institutions including the World Bank have raised their annual growth forecasts for China’s economy.
Judging from the two-year average growth rate and the quarter-on-quarter growth rate, in the first half of the year, GDP grew by an average of 5.3% in two years, 0.3% faster than the first quarter; in the second quarter, the two-year average growth was 5.5%, 0.5% faster than the first quarter, and increased from the previous quarter. 1.3%. This shows that China’s economic growth is continuing to recover, accelerating quarter by quarter.
From the perspective of major economic indicators, my country’s economy has not only maintained the basic pattern of the first increase in production and supply, but also has shown a good trend of follow-up and recovery of market demand. The economic cycle is gradually unblocked and the economic structure is continuously optimized. In the first half of the year, the contribution rate of domestic demand to economic growth reached 80.9%, an increase of 4.9 percentage points from the first quarter. The contribution rate of final consumption expenditure to economic growth reached 61.7%, 42.5 percentage points higher than the total capital formation. In terms of investment, high-tech investment with strong momentum, investment in social sectors that make up for shortcomings, and private investment that reflect market vitality have all increased rapidly. In terms of exports, in the first half of the year, the scale of my country’s import and export of goods trade hit the highest level in the same period in history. Since June last year, it has achieved positive year-on-year growth for 13 consecutive months.
my country has entered a stage of high-quality development. The economy cannot only look at the growth rate, but to achieve the unity of development quality, structure, scale, speed, efficiency, and security. Combining with the indicators of economic development quality and efficiency, the endogenous power of China’s economy has continued to increase. For example, in the first half of the year, the output of new energy vehicles, industrial robots, and integrated circuits increased by 205.0%, 69.8%, and 48.1% year-on-year, respectively, and the average growth rate in the two years exceeded 30%. New products, new formats, and new models grew vigorously. With the implementation of a series of policies to help enterprises benefit enterprises, market entities with hundreds of millions of dollars enjoy more policy dividends, and enterprise expectations and benefits continue to improve.
More importantly, despite the profound and complicated changes in the international and domestic situation, the fundamentals of my country’s economy remain stable and positive in the long run. my country’s economy has sufficient potential, resilience, vitality, large room for manoeuvre, and many policy tools. The basic characteristics of China have not changed, and the various advantages and conditions of my country’s development have not changed.
This year, my country has set the expected target of economic growth at 6% or more. Not only does it take into account that the current economic growth is restorative, it must further consolidate the foundation for development, but it also considers the smooth convergence with the targets for next year and the following year. The sustained and stable economic recovery in the first half of the year laid a good foundation for economic operations in the second half of the year, but while strengthening our confidence, we must also face up to the difficulties. At present, the domestic and international environment is still complicated. The spillover effects of loose policies in major economies have increased. There are many uncertain and unstable factors. The steady recovery of domestic demand is constrained. The recovery of some service industries and small and micro enterprises has been slow, especially the large commodity prices. Rising and raising business costs, structural contradictions in employment continue to emerge, and the foundation for economic recovery is not yet solid.
The economic work in 2021 has entered the second half of the process. Faced with the realities, new and old problems in the process of economic recovery, we must insist on normalizing epidemic prevention and control and not relax, take the current and long-term into consideration, and make good use of the window period with less pressure for stable growth. Concentrate on deepening the supply-side structural reforms, open up the domestic and international dual-cycle blockages, continue to consolidate the foundation of “stability”, accumulate the strength of “progress”, and keep the bottom line of “guarantee”. Macroeconomic policies must maintain continuity and stability, insist on not engaging in “overwhelming flooding”, and at the same time enhance forward-looking precision, strengthen interval control, and insist on giving priority to employment. We will vigorously help enterprises to relieve their development, focus on releasing the potential of domestic demand, consolidate their capital, stabilize expectations, and strive to maintain economic operation within a reasonable range, so that the economy can reach a higher level of equilibrium in the recovery.
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