China’s economy in orderly restoration
By Lu Ya’nan, People’s Daily
The novel
coronavirus outbreak will result in temporary economic setback, but it will not
change China's positive economic fundamentals and the long-term trend, the
country's top economic regulator said on Monday.
China’s
GDP fell by 6.8 percent in the January-March quarter, with major macroeconomic
indicators contracting. “We have the confidence, conditions and capabilities to
accelerate the push for a return to the pre-crisis economic level and achieve
the annual growth goal for economic and social development,” said Yan
Pengcheng, director of the Department of National Economy at the National
Development and Reform Commission (NDRC), explaining the country will rely on
its strong domestic market, hedge against risks with macro policies, straighten
economic circulation and give play to the roles of market entities.
Economic
operation amid COVID-19 isn’t comparable to that under normal orders. Yan
believes that the performance of the Q1 economy shall be evaluated under the
greater background to which the pandemic has brought huge impacts.
Objectively
speaking, China has adopted higher-than-standard containment measures in a
prompt and decisive manner since the onset of the COVID-19 epidemic, which not
only curbed the spread of the virus in a very short period of time, but also
secured the basic life for 1.4 billion people and maintained social order.
“We have
to make sacrifice to contain the disease, as life is priceless. The short-term
economic pressure is worth it and something we must bear because the lives and
health of the people are more important,” Yan explained.
China’s
economy is recovering in an orderly manner. Since March, economic indicators of
the country have started picking up, and the country’s domestic demand was also
bouncing back. The decrease of investment and consumption in the first quarter
reduced by 8.4 and 1.5 percentage points respectively than that in the first
two months. Both the purchasing managers index (PMI) and non-manufacturing PMI
of the country rose above the 50-point mark indicating economic expansion. In
the first half of April, the country’s power generation capacity expanded by
1.2 percent from a year ago, indicating positive growth.
To
stabilize the economic fundamentals and safeguard the bottom line of
livelihood, China will issue a package of macro policies that cover the
following five major aspects.
Regarding
the difficulties obstructing production resumption, China will accelerate the
eradication of improper regulations and unreasonable rules. It will support
micro- and small-enterprises, as well as individual businesses to restore
operation, so as to drive the work resumption of upper- and lower-stream
industries, and enterprises of different sizes.
The
country will also adopt more constructive fiscal policies and more flexible
monetary policies to mitigate the impacts from the pandemic, in case the
short-term influence turns into a lasting trend. China will improve its deficit
ratio, issue special bonds and largely expand the issuance of local government
special bonds.
The
country will stabilize traditionally major consumption, such as automobiles and
home appliances. Besides, it will appropriately enhance public consumption,
foster new growth points, drive online consumption and spur in-store
performance. To expand effective investment, the country will focus on the
areas of weakness, especially those exposed amid the COVID-19 pandemic.
While
accelerating the implementation of existing policies to aid enterprises, the
country will further study and issue relevant supportive measures, doing all it
can to stabilize enterprises, especially small- and medium-sized ones. It will
make all-out efforts to help foreign trade enterprises resume production, keep
international logistics channel unimpeded, and help enterprises secure orders,
markets and shares.
Besides,
the country will lay huge attention on major workforce groups such as college
graduates, migrant workers, and laborers from impoverished regions to enhance
employment stability. Meanwhile, it will offer basic living allowance, relief
and support, as well as temporary shelters for those in dire poverty.
According
to Yan, China’s CPI in March shrank by 1.2 percent from a month ago, the
largest month-to-month decrease in the recent 10 years or so, which indicated
the rapidly alleviated impacts from the COVID-19 pandemic on major farm produce
and other commodities. As the Chinese society and production take further steps
toward recovery, continuous CPI declines are expected.
The NDRC
will keep supporting the work resumption of the hog industry, encourage the
production expansion of poultry, meat and aquatic products, and enhance the management
of spring ploughing. Cold-chain logistics will also be developed to lower
transportation cost and relevant expenses in transaction. In addition, China
will monitor and guide local departments to expand temporary subsidies and
deliver the money to those in need in a timely manner.
\
Employees work on a
production line in Tsingtao Brewery (Zhangjiakou) Co., Ltd. in Xuanhua economic
development zone, north China’s Hebei province, April 18, 2020. Photo by Chen
Xiaodong, People’s Daily Online
China’s economy in orderly restoration
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