A New Form of Real Economy

Shenzhen Special Zone Daily March 20

As China’s economy is shifting gears and transforming its growth drivers, various new business models have emerged. A new form of real economy, characterized by the fusion of new technologies with the traditional real economy, has thrived.

The real economy traditionally refers to tangible industries that generate goods and services and it undoubtedly should be the pillar of China’s economy.

However, the real economy, as epitomized by manufacturing, faces sluggish growth. Moreover, many traditional industries are encountering unprecedented challenges in creating job opportunities for workers laid off in the process of cutting overcapacity and destocking.

Under such circumstances, the new real economy has become an emerging driver of growth. According to data from the National Bureau of Statistics, the online retail sales volume increased by 26.2 percent year on year in 2016.

New business models allying traditional industries with the Internet have permeated every aspect of the economy and society and revolutionized production methods and logistics. For instance, the government’s Internet Plus Education strategy has paved the way for the rapid growth of online education.

In a word, the new real economy is not designed to squeeze out or replace the traditional one, but rather to transform and upgrade it.