Strong resilience of Chinese economy

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In this Tuesday, Aug. 11, 2015 photo, a bank clerk counts Chinese currency notes at a bank outlet in Huaibei in central China's Anhui province. China’s surprise move on Tuesday to devalue its currency has intensified concerns about a slowdown in the world’s second-largest economy, whose growth rate has reached a six-year low. It is also fanning tensions with the United States and Europe, whose exports could become comparatively costlier. (Chinatopix via AP) CHINA OUT

Source:Xinhua

A range of data have shown the Chinese economy is resilient, with supply-side reform delivering progress.

Meng Wei, a spokesman with the National Development and Reform Commission (NDRC), the country’s economic planning agency, said Wednesday that market prices remained stable, which was compatible with the country’s economic fundamentals.

“It is a reflection of fruitful supply-side reform, more balanced market supply and demand, and enhanced stability in economic development,” she noted.

A range of economic data has shined a positive light on the world’s second largest economy.

China’s electricity consumption picked up in April with 7.8 percent year-on-year growth, faster than the 3.6-percent growth recorded in March, the National Bureau of Statistics (NBS) has reported.

The consumer price index (CPI), a main gauge of inflation, rose 1.8 percent year-on-year in April, compared with 2.1 percent for March.

The producer price index (PPI), which measures the cost of goods at the factory gate, rose 3.4 percent year-on-year in April, up from the 3.1 percent recorded in March.

On the supply side, the proportion of social logistic expenditure to GDP stood at 14.6 percent in 2017, falling for five years in a row.

In the first quarter of 2018, the proportion declined further to 14.5 percent, but was still above the level in developed economies.

“It reflects the fact that logistic costs are too high in China, while efficiency is too low,” Meng said.

To bring down logistics costs, the NDRC has introduced concrete measures. Starting May 1, the value-added tax in the transport sector had been reduced to 10 percent.

Also as of May 1, the NDRC had lowered the electricity costs for industrial and business users.

China’s economic activity held largely stable in April, with strong momentum in the industrial sector buffering the impact from slowing retail sales and fixed asset investment.

“China’s economy maintained its trend of steady development in April,” NBS spokesperson Liu Aihua said Tuesday.

A breakdown of the data showed industrial structure continued to improve, with production in high-tech industries and the equipment manufacturing sector expanding by double-digit rates.

Output of new energy vehicles saw a surge of 82.2 percent year-on-year in April, while industrial robot production jumped by 35.4 percent.

“However, it is worth noting that the economy still faces growing external uncertainties and the acute problems of unbalanced and inadequate domestic development,” Liu said.

Earlier data showed China’s economy expanded 6.8 percent year-on-year at comparable prices in the first three months of 2018, above the government’s annual target of around 6.5 percent.

Posted in: ECONOMY

 

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