Path set for sta­ble, healthy growth

Top Party meet­ing agrees that five tasks will be given pri­or­ity

China Daily (Hong Kong) - - FRONT PAGE - By XIN ZHIMING xinzhim­ing@chi­nadaily.com.cn

China will forge ahead with its sup­ply-side struc­tural re­form aimed at cut­ting ex­ces­sive ca­pac­ity and low­er­ing en­ter­prises’ costs, mod­er­ately ex­pand de­mand and pro­mote in­no­va­tion next year to achieve sta­ble and healthy eco­nomic growth, ac­cord­ing to a top Party meet­ing on Fri­day.

“Seek­ing progress while main­tain­ing sta­bil­ity will be the prin­ci­ple of eco­nomic work for China next year,” ac­cord­ing to a state­ment re­leased after the meet­ing of the Po­lit­i­cal Bureau of the Com­mu­nist Party of China’s Cen­tral Com­mit­tee. The meet­ing was presided over by Pres­i­dent Xi Jin­ping.

It said ef­forts should be made to pro­mote sta­ble growth, re­form and peo­ple’s well-be­ing and to pre­vent risks.

Pri­or­ity will be placed on five ma­jor tasks: cut­ting ex­ces- sive ca­pac­ity, de­stock­ing, delever­ag­ing, re­duc­ing cor­po­rate costs and shoring up the econ­omy’s weak links, the meet­ing agreed. Ad­di­tion­ally, the real econ­omy sec­tors will be boosted.

The coun­try will push ahead with the Belt and Road Ini­tia­tive aimed at boost­ing trade and con­nec­tiv­ity across Asia, Europe and Africa.

It will also ex­pand its open­ing-up and act to at­tract for­eign in­vest­ment, ac­cord­ing to the meet­ing, which was held ahead of the an­nual Cen­tral Eco­nomic Work Con­fer­ence later this month. At the con­fer­ence, top lead­ers will map out the coun­try’s eco­nomic and re­form agenda for 2017.

China’s eco­nomic pri­or­ity next year should be sta­bil­ity, ac­cord­ing to a Citibank re­port.

It added that China still has am­ple pol­icy tools to shore up next year’s growth, which is ex­pected to reach 6.5 per­cent.

A se­ries of re­cent eco­nomic in­di­ca­tors have pointed to sta­bi­liz­ing growth, with prices be­gin­ning to pick up mod­er­ately in Novem­ber, in­di­cat­ing ris­ing eco­nomic ac­tiv­ity.

China’s con­sumer price in­dex, a gauge of in­fla­tion, rose by 2.3 per­cent year-onyear in Novem­ber, the fastest in six months.

The pro­ducer price in­dex, which mea­sures fac­tory-gate prices, con­tin­ued to pick up to reach 3.3 per­cent, the Na­tional Bureau of Sta­tis­tics said on Fri­day.

The CPI hit 1.3 per­cent in Au­gust, the low­est this year, and the PPI was -5.9 per­cent at the start of this year, trig­ger­ing con­cerns that the coun­try could be slid­ing into a de­fla­tion­ary cy­cle.

But the ris­ing con­sumer and pro­ducer price in­dexes in Novem­ber, to­gether with other in­di­ca­tors, show the econ­omy could have started to sta­bi­lize, an­a­lysts said.

Ray­mond Ye­ung, chief econ­o­mist for greater China at Aus­tralia & New Zealand Bank­ing Group Ltd in Hong Kong, told Bloomberg that “China has en­tered a new in­fla­tion­ary cy­cle”.

How­ever, China’s real es­tate prices re­main at high lev­els, and it faces the threat of as­set bub­bles, which means China’s mone­tary stance may re­main mod­er­ately tight, said Jiang Chao, an an­a­lyst at Haitong Se­cu­ri­ties.

LONG WEI / FOR CHINA DAILY

The ris­ing con­sumer price in­dex could be one sig­nal that the econ­omy has be­gun to sta­bi­lize.

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