China’s economy is set to continue its steady run for the rest of the year despite lingering market headwinds, said Ning Jizhe, deputy head of the National Development and Reform Commission.
Ning, who’s also head of the National Bureau of Statistics, said the rise of protectionism and unilateralism, as well as fluctuations in global financial and commodity markets, will inevitably affect China, as the country has already become highly integrated with the world economy since it promoted reform and opening-up 40 years ago.
The economy, however, is on track to reach its annual growth target, which is evident from four major indicators-the overall economic growth rate, employment rates, prices and the balance of payments, Ning said in a recent interview.
He said China enjoys the conditions, capability and confidence to meet the target of around 6.5 percent GDP growth for 2018. At the end of August, the country was 90 percent of the way to its goal of creating 11 million new jobs in urban areas this year.
Ning made the comments as some indicators have shown signs of slower growth amid mounting China-US trade tensions.
Noting fluctuations of the data were within a normal range, Ning said the economy will be resilient and sustainable in the third and fourth quarters, underpinned by the generally stable situation and the country’s firm pace of reform and opening-up.
On Sept 24, new US levies on $200 billion worth of Chinese goods came into force, followed by Beijing’s tariffs on about $60 billion worth of US imports. Prior to that, both parties raised tariffs on $50 billion worth of each others’ goods.
The US tariff moves have a certain influence on China’s economy, Ning said, but “the overall impact is under control”. China has taken a series of measures to resolve the impact of the ongoing Sino-US trade dispute.
“China will continue to maintain steady momentum, advance structural reforms, promote high-quality economic development and seek progress,” said the senior official.
“It will also maintain a stable performance in terms of employment, finance, foreign trade, investment and expectations,” Ning added.
Specifically, China endeavors to elevate the comfort level for companies, cut taxes and fees, expand employment and re-employment and boost domestic demand. It is also promoting coordinated development of the regional economy, deepening reforms, expanding opening-up, promoting trade with more foreign countries and facilitating foreign companies’ entry to China and Chinese companies’ expansion abroad.
Ning noted that China has been giving great importance to risk prevention and steady growth. “China’s overall leverage level is not very high, but at a moderate level globally.”
He added that the debt level of large industrial companies has steadily dropped in recent years. In late August, their average debt-to-asset ratio was at 56.6 percent, dropping 0.5 percentage point from a year earlier.
Experts believe the government’s recent adjustment toward a pro-growth stance can further fuel stable economic expansion.
Wang Tao, an economist at banking group UBS, expects more policy easing, but the magnitude of easing will be designed to mainly offset any upcoming external shocks.
Wang Yiming, vice-president of the State Council’s Development Research Center, said that China should ramp up efforts to protect intellectual property, improve the mechanism for risk management and promote opening-up to boost quality growth.