China’s economic data from the first quarter showed a steady economic development trend, with many positive increases and several improving economic indicators lifting full-year economic prospects.
Indicators show steady growth
According to the National Bureau of Statistics (NBS), China’s economic growth increased, structure adjustment promoted, innovation development sped up and people’s lives improved in the first quarter. Improvements in industrial production, enterprise revenue, service sectors and exports have combined to bring surprises to the macro economy.
Mao Shengyong, spokesperson from NBS, attributed the steady economic trend to the rise in economic growth, steady pricing trend, expanded employment and improved international balance of payment.
The Chinese economy saw its gross domestic product (GDP) rise 6.9 percent year-on-year in the first quarter, up from 6.8-percent growth in the previous quarter. Consumer price index, a main gauge of inflation, grew 1.4 percent year-on-year and producer price inflation saw a 7.4 percent year-on-year increase.
The job market also saw 3.34 million new jobs, 160,000 more than in the same period of last year, while the goods trade surplus in the first quarter surpassed 450 billion yuan, according to NBS data.
Powerful industrial and consumption performance
In addition, analysts also attributed the fast economic growth in the first quarter to the strong industrial development and consumption.
With progress in supply-side structural reform, supply and demand in the market have been improved, and the confidence of enterprises also increased.
In the first quarter, capacity utilization in industry above designated scale was 75.8 percent, 2 percentage points higher than the previous quarter; debt asset ratio and costs of industrial enterprises also decreased in the first quarter.
When the performance of enterprises improves, they will expand production, which will in turn make contributions to economic growth, said Mao.
He said the industrial value of the secondary industry saw a year-on-year increase of 6.4 percent, and its contribution to gross domestic growth was 36.1 percent, an increase of 1.1 percentage points.
Consumption contributed 77.2 percent to the GDP increase in the first quarter, 2.2 percentage points higher than the same period last year. From the perspective of consumption structure, service consumption is increasing with a growing speed, and quality consumption is also accelerating.
Meanwhile, the service sector rose 7.7 percent year-on-year in the first quarter, outpacing a 3-percent increase in agriculture and 6.4 percent in the secondary industry. It accounted for 56.5 percent of the overall economy.
In addition, strategic emerging industries also saw a year-on-year increase of 10.3 percent, 3.5 percentage point higher than the industry above designated scale.
Private investment growth picks up
Private investment witnessed prominent development. Data shows fix-asset investment nationwide surpassed 9.3 trillion yuan, 9.2 percent higher than the same period of last year. Among them, private investment reached 5.7 trillion yuan, accounting for 61.1 percent of the total.
Manufacturing investment and private investment maintained continued growth since last September, Mao said.
Private investment growth rate in the first quarter was higher than in the first two months, and manufacturing investment growth rate also exceeded 1.5 percentage points from that period, data shows.
To solve private investment slowdowns of the last year, inspection teams sent by the State Council to local governments made great efforts to ensure government policies were carried out.
It is expected that private investment growth rate will continue to rise, Mao said. Increasingly improved market environment and related support policies will lay a solid foundation for its development, he added.
Benefits from reforms increase
The fact that China’s economy is becoming more stable is confirmed, Mao said. There are two features in China’s economic operations in the long term.
One of them is that China’s economy is operating in an appropriate range.
China’s economic growth rates in 2015, 2016 and the first quarter of 2017 were 6.9 percent, 6.7 percent and 6.9 percent, respectively. The tiny volatility the economic growth rates maintained between quarters in the last year also indicated a smoother and more stable economy.
Employment shows a positive trend thanks to the good economic performance. Recently 13 million urban jobs were created each year, while the unemployment rate remained at about 5.1 percent.
Given the appropriate range, it makes no difference to pursue an exact GDP rate, or whether the rate goes up or down, Mao said.
Besides, positive changes in industrial structure bolster economic growth — the proportion of tertiary industry has exceeded 50 percent, the service sector performed well, and the contribution rate of consumption is rising to more than 60 percent.
There is much room for economic development due to China’s urbanization course, industrial and agricultural upgrades, internet development and abundant human resources. Also, the reforms taking place in China will generate huge benefits as a strong support to economic growth.