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Slower growth but higher quality in China’s economy

Updated: Sep 23,2015 5:21 PM

In the second half of the year, the Chinese economy will continue to grow at a medium to high speed, and the yearly economic growth rate may be around 7 percent, said Li Pumin, secretary-general and spokesman for the National Development and Reform Commission.

In recent years, the growth rate of the Chinese economy has been decreasing from the past 10 percent to the current 7 percent, which is the “new normal” stage — slower but higher-quality. As the scale of the Chinese economy is huge, each percent of economic growth is a big increment.

Li predicted that consumption in the next several months will still be high, and investment growth will become stable due to a series of investment policies. The situation of agricultural production is stable, and it is expected to gain harvest again in the second half of the year.

Some research institutions said the growth rate of the Chinese economy is lower than 7 percent in terms of power consumption and transportation volume, but they neglected the structural change of the Chinese economy, analysts said.

In the first half of the year, the service industry accounted for 49.5 percent of the GDP, which is 6.6 percent higher than that of 2007. High-tech industries such as pharmaceutical and communication equipment manufacturing account for higher percentages in industries. Such industries are low-energy consumption and high-added value.

Though the commercial environment in China is full of challenges, there is still development potential for European companies, including small companies, said a report released in September by the European Union Chamber of Commerce in China.

Since the beginning of the year, reform policies in the administrative system, State-owned enterprises, finance and commerce have been introduced, which greatly supported the development of the economy.

The Chinese government also provides full support for the development of innovation and entrepreneurship. More important, in the process of transformation and upgrading, the government is enhancing its ability to handle different complex situations and control risks.