Prospects for Chinese economy are still bright

market. The Chinese economy has been brought into a new status and will keep the accelerating rate as it steps up to a higher level. The future prospect is still bright.

Despite the complexity and volatilities of the world economy, the Chinese economy has maintained a 7 percent growth rate in the first half of this year, which is one of the highest in the world. In the first six months of this year, 7.18 million new jobs have been created in cities and towns, achieving 71.8 percent of the annual goal. The average income rate has grown by 7.6 percent year on year. The two core indices of employment and income have shown the steady growth of Chinese economy. from last year.

The potential of the Chinese market is huge with the new industrialisation and advancing IT application, urbanisation and agricultural modernisation. Chinese people are becoming more willing to spend what they have earned through hard work. The middle-class is rising up in China. All of these are the basic facts about the Chinese economy. People who know the Chinese economy well will see that the current problems are just temporary economic transformations. The key to solving these questions is reform and opening-up. The upcoming new round of reforms is unprecedentedly comprehensive. The 3rd Plenary Session of 18th CPC Central Committee has set the guidance for continuing policy reforms. Over 330 points to reform have been raised. The 80 major reform tasks have been mostly finished in 2014. About 70 reform proposals have been raised in the first six months of this year, of which the effects will gradually unveil.

We all know that the most imperative problem to solve for China is the imbalanced, uncoordinated and unsustainable problems that have emerged in the development. To evaluate the quality and rewards in Chinese economic growth, strong incentives are needed. To reform means to change, and changes are often enshrouded with uncertainty. Worries over uncertainty keep Chinese people vigilant in their economic development.

China is trying hard to keep the macroeconomy stable through practical actions. To tackle the abnormal fluctuations in the stock market, the Chinese government has curbed the spread of panic and thus avoided a systemic risk. China has also finalised the renminbi exchange rate quotation mechanism.

Short-term currency fluctuations might occur, but there is no basis for any continued depreciation. Increasing the intensity of the market-determined exchange rate is part of an established market-oriented reform. This has nothing to do with a socalled currency war. The speculations of stimulating exports for any so-called quick fix are ludicrous.

To drive this train named Chinese economy, we do not need to press the accelerator, or to pull the break. The Chinese economy will be escalating in a steady way. No nation is isolated in globalisation. A win-win, instead of a zero-sum game, is the right way for economic development. “The interests of China and the US are deeply interconnected, and we have greater responsibilities for world peace and human progress,” Xi said at the joint press conference with President Barack Obama in Washington, DC.

Xi’s statement reveals the logic behind the global economic growth. China has huge economic potential, with leeway and internal strength coming at the same time. China is thus fully able to maintain a high level of long-term economic growth, and to provide a vast market and a solid support for the world economy. An open China will continue to draw strength from the developing world, and the development of China will eventually benefit the world.

This commentary is published with permission from the People’s Daily. By 2050 it is possible that the US economy will not just be smaller than China’s – but India’s as well. As of 2014, India’s economy was the world’s third-largest in terms of purchasing power parity. India’s economy is at present only a little over 40 percent as large as the US and Chinese economies. The Indian economy is expected to be about 2 percent larger than the US economy by mid-century:

1. By mid-century, China will almost certainly have long secured its spot at the top of the global economic league table. 2. However, by 2050 it is possible that the US economy will not just be smaller than China’s – but India’s as well. 3. India launched its market-based reforms a little more than a decade after China, in 1991. 4. As of 2014, India’s $7.3 trillion (R101.4 trillion) economy was the world’s third-largest, measured in terms of purchasing power parity (PPP). 5. However, India’s economy is at present only a little over 40 percent as large as the US and Chinese economies. 6. While India’s growth has not been as strong as China’s over the past two decades, its growth rate is expected to outpace China’s in the coming decades. 7. To realise this potential, India will need to sustain its reform policies and increase investment in infrastructure, education (especially women) and better governance. 8. According to PwC, the Indian economy is expected to be about 2 percent larger than the US economy by mid-century. 9. Even though India’s economy may exceed that of the US by mid-century, when measured on a PPP basis, it will then still be about 30 percent smaller than that of China.