Eco­nomic mo­men­tum main­tained

China Daily (USA) - - FRONT PAGE - By XIN ZHIMING and WANG YANFEI in Bei­jing Con­tact the writ­ers at xinzhim­ing@chi­

China con­tin­ued its eco­nomic im­pe­tus last month, with bet­terthan-ex­pected re­sults recorded in sev­eral ma­jor in­di­ca­tors, ac­cord­ing to govern­ment data.

An­a­lysts said the econ­omy ap­pears to be sta­bi­liz­ing, de­spite the frag­ile global mar­ket and prob­lems re­main­ing with do­mes­tic de­vel­op­ment.

The in­dus­trial sec­tor con­tin­ued the trend seen in July, with year-on-year growth climb­ing to 6.3 per­cent in Au­gust, a month-on-month in­crease of 0.3 per­cent­age points. This was the fastest growth in five months, the Na­tional Bureau of Sta­tis­tics said on Tues­day.

The mar­ket had ex­pected in­dus­trial growth to ex­pand by 6.1 per­cent, ac­cord­ing to a Reuters poll.

Re­tail sales growth rose to 10.6 per­cent in Au­gust, com­pared with 10.2 per­cent in July, while fixed-as­set in­vest­ment grew 8.2 per­cent year-on-year in Au­gust, up by 4.3 per­cent­age points from the pre­vi­ous month, ac­cord­ing to the bureau.

Sheng Laiyun, spokesman for the bureau, said at a news con­fer­ence: “On the whole, there have been pos­i­tive changes in the na­tional econ­omy, with main in­di­ca­tors pick­ing up, struc­tural re­form deep­en­ing and growth of new sec­tors ac­cel­er­at­ing. The over­all trend of eco­nomic growth sta­bi­liz­ing this year has con­tin­ued (in Au­gust).”

Sheng said con­sid­er­able head­way has been made in struc­tural re­form. For ex­am­ple, steel in­dus­try stocks fell by 12.2 per­cent year-on-year in the first eight months, and the as­set li­a­bil­ity ra­tio of ma­jor in­dus­trial en­ter­prises fell to 56.4 per­cent by the end of July, a 0.6 per­cent­age point drop from a year ago.

Out­put of high-tech in­dus­tries grew by 11.8 per­cent in Au­gust, higher than over­all in­dus­trial out­put growth, while sales in emerg­ing in­dus­tries, such as on­line med­i­cal ser­vices and on­line ed­u­ca­tion, saw fast growth.

Liu Dongliang, an economist at China Mer­chants Bank, said, “The Au­gust data beat mar­ket ex­pec­ta­tions, in­di­cat­ing that eco­nomic down­turn pres­sure has eased and the coun­try’s growth-sta­bi­liz­ing poli­cies have

On the whole, there have been pos­i­tive changes in the na­tional econ­omy.” Sheng Laiyun, spokesman, Na­tional Bureau of Sta­tis­tics

taken ef­fect.”

Fixed-as­set in­vest­ment, in par­tic­u­lar, was a bright spot in Au­gust, with four con­sec­u­tive months of de­clines halted.

Gao Yuwei, a re­searcher at the In­sti­tute of In­ter­na­tional Fi­nance, a Bank of China think tank, said, “There have been signs of in­vest­ment sta­bi­liz­ing and im­prov­ing.”

But Liu warned that the sta­bi­liza­tion could be tem­po­rary, adding that more time was needed to as­cer­tain whether the im­prov­ing trend would con­tinue in com­ing months.

“In the sec­ond half of this year, China may face tighter fis­cal ex­pen­di­ture pres­sure, lead­ing to slower growth of in­fra­struc­ture in­vest­ment, which could drag on over­all fixed-as­set in­vest­ment growth,” he said.

An­other po­ten­tial risk is pri­vate in­vest­ment, which grew by just 2.1 per­cent year-on-year in the first eight months of the year, the same as in the Jan­uary-July pe­riod and re­main­ing at record lows, ac­cord­ing to the bureau.

China has at­tempted to boost pri­vate in­vest­ment, which largely re­flects the vi­tal­ity of the econ­omy and plays a cru­cial role in con­tribut­ing to bal­anced and sta­ble eco­nomic growth.

But en­ter­prises have found it hard to find po­ten­tially prof­itable projects to in­vest amid slug­gish na­tional eco­nomic growth.

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