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Economic Trend: Recovery Has Taken The Lead To Pick Up And Take Efforts.

2009/5/5 15:22:00 42029

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Interview with Zhang Yutai, director of the development research center of the State Council

China's economy has taken the lead, but the recovery is still unstable.

Reporter: at the beginning of the year, you predicted: "China's economy is fully qualified to take the lead in the world's major economies."

4 months later, have we taken the lead?

Are there any signs of macroeconomic or microeconomic changes in recent years, or a "W" rebound?

Zhang Yutai: my prediction is based on the analysis of China's economic development trend.

Now, I still believe this judgement.

In the first quarter, China's economic operation has experienced positive changes, especially in March, when economic indicators improved significantly over the first two months, and investment and consumption grew rapidly.

With the effective promotion of the central and local policies to stimulate the economy, China's economy has been the first to pick up, and is picking up and developing the best in the world's major economies.

GDP growth is expected to resume from the two quarter.

But we still face many unfavorable factors and we must not be blindly optimistic.

For example, the external shocks brought by the international financial crisis have been pmitted to China's real economy through the rapid shrinkage of external demand; the structural contradictions and institutional problems accumulated in China for a long time become more prominent when the economic growth rate falls.

Whether the short-term economic recovery in China can be pformed into the recovery of the medium and long term economic growth and the reversal of the good turn, there are still some unstable and uncertain factors to be continued.

The growth rate of GDP is close to normal periodic callbacks, and many economic indicators are better than expected.

Reporter: there are different views on China's recent economic data. Do you think it is better than expected or lower than expected?

Zhang Yutai: the evolution speed of the subprime mortgage crisis in the United States and its losses to the financial industry in Europe and the United States and the impact on the global economy are often unexpected.

The trend and impact of the US financial crisis are still controversial. The views on China's economic performance and future trends are different.

Today, with the high relevance of the global economy, it is difficult to accurately grasp the medium and long term economic trend in China only by short-term performance of individual economic indicators.

After 8 consecutive years of rapid growth since 2000, China's economic operation has entered a cyclical decline since the three quarter of 2007. The GDP growth rate callback is a normal phenomenon. But the sharp decline in the four quarter of 2008 and the 5 percentage points in the first quarter of this year has gone far beyond the normal cyclical adjustment range.

In the first quarter, China's GDP growth rate was only 6.1%, which was further reduced by 0.7 percentage points over the four quarter of 2008. The main reason is that the negative impact of the US financial crisis has expanded, and the decline in the major economies such as the US, Europe and Japan and the drop in imports have exceeded expectations. In the first quarter of the year, the depth of the 19.4% decline has occurred.

Judging from other indicators, due to the strong and rapid economic stimulus in China, the policy guidance effect is beginning to show. I personally believe that many important economic indicators in the first quarter are indeed better than expected.

For example, the growth rate of investment in fixed assets is as high as 28.8%, which is the highest level in 3 years. The total retail sales of social goods actually increased by 15.9%. The manufacturing purchasing managers' index (PMI), which has the significance of leading indicators, has exceeded 50 for 4 consecutive months, all better than expected.

At the moment, we can not say the bottom.

To prevent a two dip

Reporter: Recently, China's economy has hit bottom with foreign power. Is that so?

Zhang Yutai: the United States is the world's largest economy, and the recovery of the US economy is crucial to the global economic recovery.

I hope the US economy will be as bright as president Obama.

However, objectively speaking, the US and Europe have not really got rid of the crisis, and the US economic outlook in the near future is not optimistic.

The fourth quarter of last year to the first quarter of this year, China's economy is in the process of bottoming out, but it can not be seen lightly.

At present, with the price stabilization of primary products and the decline of enterprise inventory level, the short-term negative factors that affect economic growth tend to weaken.

Domestic demand grew well in the first quarter, and China's economic growth approached normal periodic callbacks.

However, from the external perspective, the pattern of world economic recession has not changed. It is still time for major economies to digest financial non-performing assets and increase external demand.

From the perspective of domestic demand, the market led independent investment of enterprises has not been fully followed up. The income of urban and rural residents is increasing more difficult, and the foundation for sustained rapid growth of consumption is not stable.

Therefore, in the positive changes of the economy, we should enhance confidence and seek truth from facts, closely observe the new phenomena, new situations and new trends in the economic operation, and prefer to estimate the difficulties more fully and prepare more fully, and take more effective measures to ensure sustained economic growth and prevent the two bottom finding.

In the short term, relying on expanding domestic demand is difficult to replace or compensate for the gap caused by contraction of external demand.

Reporter: what are the biggest difficulties and challenges facing the Chinese economy in the two quarter or even longer period?

Zhang Yutai: the most outstanding challenge is how to cope with the external demand and the series of economic and social problems arising from it.

The global financial crisis has led to a sharp decline in external demand, which has seriously impacted on China's foreign trade. Exports dropped nearly 20% in the first quarter, unprecedented.

The crisis will further deepen and the export situation is still very grim.

Due to the large shrinkage of external demand, there is a big difference between structure and domestic demand. In the short term, relying on expanding domestic demand, it is difficult to replace or compensate for the demand gap caused by contraction of external demand.

How to stabilize external demand will be a major problem for us in the current and future period.

The relationship between domestic demand and external demand is mutual promotion instead of mutual substitution.

The state's policy of stimulating the economy has already worked for stabilizing domestic demand, but the foundation is still not solid.

Export falls, enterprises and their upstream and downstream related industries decline in efficiency, bankruptcy and layoffs increase, a large number of migrant workers laid-off and unemployed, exacerbating the pressure of employment.

At the same time, the social security system of migrant workers is not perfect, which makes social stability more prominent.

The most important thing is to carry out the package plan well, but there must be some backup.

Reporter: the parties are full of expectations for the new economic stimulus plan of the Chinese government. Do you think it is necessary to further increase the policy?

Zhang Yutai: in the current crisis, the international community highly appraised the Chinese government's macroeconomic regulation and control policy.

Since last year, the state has implemented a package of plans to ensure growth and expand domestic demand.

Both financial policy and monetary policy have a certain time lag.

For example, the implementation of many investment projects needs corresponding preliminary work, and infrastructure construction must complete feasibility evaluation, planning, design, and so on, so as to enter the construction stage.

After the implementation of the project, it will take a certain time to pull up the upstream and downstream industries and promote private investment.

So far, the package has only begun to show results. The most important thing at present is to implement all the policies and measures that have been put into effect so as to bring them into full play.

Of course, we should always pay attention to and judge the trend of the economy. We should make preparations for the early plan and keep the reserves in hand. This is the concrete embodiment of the government's macroeconomic regulation and control ability, and also helps to boost market confidence.

The goal of "8 guarantees" can be achieved, and policies and measures should be timely enriched and perfected.

Reporter: GDP grew by 6.1% in the first quarter. Some people wonder whether the whole year can "guarantee 8"?

What are we going to do to achieve this goal?

Zhang Yutai: from a comprehensive perspective, the growth of GDP6.1% directly reflects the good change of China's economy, and there is still room for operation of macroeconomic regulation and control policies.

I think this year's goal of "8 guarantees" can be achieved.

"Guarantee 8" is not the only goal of this round of macroeconomic regulation and control, nor is it the ultimate goal.

It is necessary to protect the overall balance of macro-economy, combine the short-term economic stimulus with the medium and long term structural optimization and upgrading, and flexibly grasp the intensity and rhythm of macro adjustment. For example, since November last year, the loan growth rate is very fast. We must pay close attention to the flow of loans, increase the intensity of reform, respond to the crisis with system and mechanism innovation, acquire resources, technology, brand and international marketing channels through international mergers and acquisitions, strategic cooperation, and lay a solid foundation for enhancing the status of China in the global division of labor.

At present, we should persist in actively expanding domestic demand and making effective use of foreign demand. We should continue to implement a proactive fiscal policy and moderately loose monetary policy, and promptly enrich and improve it.

First, continue to expand investment as the primary task, pay close attention to implementation, pay attention to stimulating and guiding the market's autonomous investment, accelerate the reform of investment and financing system, and expand the access field of private investment.

The two is to combine the expansion of consumption and consumption structure, and guide urban and rural residents to increase culture, health, green and information consumption.

Three, we need to "stabilize external demand and protect exports" under multi pronged approach, constantly enhance our international competitiveness and seize opportunities to promote the pformation and upgrading of foreign trade.

Four is to improve the social security system, based on "protecting employment and improving people's livelihood", and effectively resolving the employment difficulties of migrant workers and college graduates.