How na­tion’s growth proved skep­tics wrong

China Daily European Weekly - - Front Page - XIN­HUA

BEI­JING — As 2017 draws to a close, there is no doubt that China will meet its eco­nomic growth tar­get of 6.5 per­cent.

Reach­ing this po­si­tion has not been easy, as the coun­try is un­der­go­ing a mas­sive trans­for­ma­tion to­ward qual­ity growth. Doom­say­ers over­seas warned that the Chi­nese econ­omy may un­ravel as early as Fe­bru­ary, cit­ing a growth in bad loans cou­pled with slow­ing growth.

So why has the world’s sec­ond-largest econ­omy fared bet­ter than ex­pected?

Here are “four Rs” that of­fer a glimpse into China’s progress in what has been a tough year.


De­spite some short-term fluc­tu­a­tions, the econ­omy con­tin­ued firm growth, with GDP ex­pand­ing by 6.9 per­cent year-on-year in the first three quar­ters.

The job mar­ket is sta­ble, with reg­is­tered un­em­ploy­ment in Chi­nese cities stand­ing at 3.95 per­cent at the end of the third quar­ter, the low­est since 2008. Nearly 12 mil­lion new jobs were cre­ated in cities from Jan­uary to Oc­to­ber, ex­ceed­ing the an­nual tar­get of 11 mil­lion.

The Con­sumer Price In­dex growth stood at 1.5 per­cent com­pared with a year ago in the first 10 months, well be­low the tar­get of 3 per­cent.

Re­silience in the less-de­vel­oped north­east­ern rust belt has also im­proved, thanks to the es­tab­lish­ment of the Liaon­ing Free Trade Zone, which al­lows old in­dus­trial cities to at­tract more in­vest­ment, take ad­van­tage of the Belt and Road Ini­tia­tive and ex­plore eco­nomic co­op­er­a­tion with North­east Asia and Europe.

Yingkou, the first treaty port in North­east China that opened to for­eign­ers in 1861, has now re-emerged in the spot­light, hav­ing at­tracted for­eign in­vest­ment of 21.26 bil­lion yuan ($3.2 bil­lion; 2.7 bil­lion eu­ros; £2.4 bil­lion) since be­com­ing part of the free trade zone in April.


China has started se­ri­ous re­bal­anc­ing by cut­ting ex­cess ca­pac­ity in the steel and coal sec­tors, where it has the high­est out­put in the world.

De­spite the chal­lenge of job losses and re-em­ploy­ment, China has al­ready met the year’s ca­pac­ity re­duc­tion tar­get. As a re­sult, its in­dus­trial ca­pac­ity uti­liza­tion rose to the high­est level in five years, reach­ing 76.6 per­cent from Jan­uary to Septem­ber.

HBIS Group, the largest steel com­pany in the Bei­jing-Tian­jin-He­bei re­gion, saw its net profit rise by over 74 per­cent in the first half of this year.

An­other key mea­sure of re­bal­anc­ing is de­stock­ing. The prop­erty sec­tor, an in­dus­try with a high in­ven­tory, saw over 602 mil­lion square me­ters of prop­erty un­sold by the end of Septem­ber, down by nearly 9 mil­lion square me­ters from a month ear­lier.


In­stead of re­ly­ing heav­ily on for­eign trade and in­vest­ment, the Chi­nese econ­omy has drawn more strength from con­sump­tion, ser­vices and in­no­va­tion.

The ser­vices sec­tor ex­panded by 7.8 per­cent year-on-year in the first three quar­ters, com­pared with 3.7 per­cent in the pri­mary in­dus­try and 6.3 per­cent in the sec­ondary in­dus­try, con­tribut­ing 58.8 per­cent to the eco­nomic growth.

The high-tech and equip­ment man­u­fac­tur­ing sec­tors also be­came stronger and at­tracted more in­vest­ment. From Jan­uary to Septem­ber, in­vest­ment in the high-tech in­dus­try rose by 18.4 per­cent year-on-year, com­pared with 11.7 per­cent a year ear­lier.

Re­silience, re­struc­tur­ing, re­duc­tion and ro­bots make 2017 China’s year


The broader use of ro­bots in­di­cates that China’s man­u­fac­tur­ing is get­ting smarter. As of Oc­to­ber, the out­put of in­dus­trial ro­bots soared by 68.9 per­cent amid fast growth of ar­ti­fi­cial in­tel­li­gence tech­nol­ogy.

Lead­ing Chi­nese AI com­pany iF­lytek has ded­i­cated re­search to in­tel­li­gent speech and lan­guage tech­nolo­gies and won nearly 70 per­cent of the global Chi­nese lan­guage recog­ni­tion mar­ket.

A ro­bot co-de­vel­oped by iF­lytek and Ts­inghua Univer­sity achieved a score of 456 in the writ­ten test for the na­tional doc­tor qual­i­fi­ca­tion — higher than the na­tional pass line of 360.

As the AI era ap­proaches, the Chi­nese gov­ern­ment is en­cour­ag­ing pri­vate en­ter­prises to en­ter sec­tors like smart man­u­fac­tur­ing to im­prove the coun­try’s high-end man­u­fac­tur­ing. New in­dus­try stan­dards and spec­i­fi­ca­tions are to be es­tab­lished.

Backed by bet­ter-than-ex­pected growth, the In­ter­na­tional Mon­e­tary Fund has re­vised up­ward its fore­cast for the fourth time this year, to 6.8 per­cent this year and 6.5 per­cent next year.

Chi Fulin, head of the China In­sti­tute for Re­form and De­vel­op­ment, has pre­dicted an­nual growth of at least 6 per­cent in the next five years.


Vis­i­tors in­ter­act with ro­bots at the World In­tel­li­gent Man­u­fac­tur­ing Sum­mit in Nan­jing, Jiangsu prov­ince.

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