Premier Li Keqiang’s first public forecast for the Chinese economy in 2015 has offered little hope for a big stimulus, nor dramatic changes of macroeconomic policies from this year, experts said.
Li said the Chinese economy will face relatively large downward pressure in 2015, and the government will carry out fine-tuning of policy at appropriate times to ensure a sound development.
Although the complicated global market has added to the downward pressure, the fundamentals of the Chinese economy have not changed, Li told leaders from Southeast Asian countries, Japan and South Korea at the 17th ASEAN-China, Japan and the Republic of Korea (10+3) leaders’ meeting in Nay Pyi Taw, Myanmar, on Nov 13.
He said the economy still has leeway, the potential and resilience to maintain a sound and healthy expansion. That is possible as China is still in a critical stage of urbanization, industrialization and agriculture modernization, which could generate consumption and investment.
He said macroeconomic policies will be consistent and stable, indicating no dramatic changes, although fine-tuning is possible at appropriate times to make room to carry out reforms.
Li also reaffirmed that the Chinese economy is capable of achieving the growth target of about 7.5 percent in 2014.
A major think tank in China, the Development Research Center of the State Council, said China’s annual growth target will be around 7 percent in 2015, in line with economists’ forecasts that the country’s economic slowdown will continue next year.
Chen Yulu, a member of the People’s Bank of China’s monetary policy committee, said in a recent interview that China will not turn to a strong stimulus as long as the economy runs within a reasonable range, a term referring to a growth rate around 7.5 percent in the Chinese context.
Chen said the government will continue to use moderate pro-growth policies and continue the financial reforms that have already been taken this year.
Hu Shaowei, head of the economic forecasting department of the State Information Center, said the aging society that weakens the demographic dividend and the slowdown of the urbanization process are the two major factors that will lead to the foreseeable slower economic growth next year.
He said the urbanization process, which reached more than 50 percent by 2013, will take much longer to go above 70 percent.