Category Archives: Chinese circle

China Voice: Yuan’s substantial depreciation unlikely

01/08/2016 北欧绿色邮报网 Leave a comment

BEIJING, Jan. 6 (Greenpost) — The continued depreciation of the yuan against the U.S. dollar since August should not be grounds for doom and gloom, as a multitude of factors underpin the Chinese currency in the medium and long term. The yuan has been heading south since the People’s Bank of China (PBOC), the central bank, revamped the foreign exchange mechanism in August to make the rate more market-based.

The onshore yuan (CNY), traded in the Chinese mainland, declined 4.05 percent against the greenback in 2015. During the first two trading days of 2016, the offshore yuan (CNH) traded in Hong Kong, has consistently gone down, losing as much as 1.3 percent at one point and putting pressure on the onshore yuan to sink lower.
Short-term volatility of the yuan is understandable as “hot money” makes an exit out of China, whose economy is heading for its slowest pace in a quarter century as industrial overcapacity and housing overhang still haunt. Meanwhile, the United States is seeing recovery and raised interest rates in December, with more rises expected in 2016.
However, there is no risk for the yuan to see substantial depreciation in the long term.
China has a mammoth foreign exchange reserve (3.4 trillion U.S. dollars), sound economic fundamentals, commendable growth in labor productivity and determination to carry out necessary reforms to unlock vitality.
The inclusion of the yuan by the International Monetary Fund in its elite basket of currencies, effective this October, will give the yuan a leg up toward internationalization.
Another favorable factor is the continued weakness of global commodity prices. Reduced costs help China, the world’s biggest commodity consumer, boost its current account surplus, thus offsetting capital outflows and the depletion of its foreign exchange reserve.
A drop of 10 dollars in average oil prices, for example, would reduce the costs by 25 billion dollars a year, according to Goldman Sachs’s estimate. Low crude prices may prop up the surplus to about 360 billion dollars this year, it added.
The authorities wouldn’t want or tolerate substantial declines in the yuan either. A typical goal is to keep the currency “basically stable.”
When the PBOC introduced the new foreign exchange rules in August, there were doubts that China was purposely devaluing the yuan to boost exports. That assumption was unfounded. The authorities have no intention to manipulate any drastic depreciation as the contribution of foreign trade to the country’s economic growth has declined to the level seen at the beginning of the century.
China is capable of keeping the yuan’s exchange rate at a “reasonable” level and sees no basis for continued depreciation, PBOC Vice Governor Yi Gang said at a recent press briefing.
“In the event of drastic fluctuation or abnormality in international balance of payments and cross-border capital flow, the central bank will not hesitate to intervene,” Yi added.
To reduce the market’s fixation on the yuan-dollar rate and better reflect the market, China Foreign Exchange Trade System (CFETS) began to release a yuan exchange rate composite index in December that measures the currency’s strength relative to a basket of 13 currencies, including the U.S. dollar, euro, and Japanese yen.
An update released on Monday showed that on the last day of 2015, the CFETS yuan index stood at 100.94, meaning the yuan appreciated 0.94 percent compared to the level at the end of 2014. Enditem

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Xinhua Insight: Fulfilling lots, China expects new goals

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BEIJING, Jan. 2 (Xinhua) — One week before New Year, light came to 39,800 people in remote northwest China, the last group being able to light their homes in the world’s most populous country.

At the end of 2015, China met its goal of providing electricity to all its people, set out in the 12th five-year plan (2011-2015).
Universal power access was one of the goals China fulfilled in the past five years, ranging from railway construction to pollution control, from economic growth to resident income, and to poverty reduction.
Those achievements mark a satisfying end of the five-year plan and lay a solid foundation for the whole nation to march toward realizing its first centenary goal in the coming five years, analysts say.
The goal, one of “two centenary goals” put forward by the ruling Communist Party of China in 2012, is to double the 2010 GDP and per capita income of urban and rural residents and to complete the building of a moderately prosperous society by 2020.
On Wednesday, a new 345-km stretch of high-speed railway in the southernmost province of Hainan began operation, making it the world’s first of such railway to circle an island.
With Hainan’s high-speed loop line, China’s length of operating railways exceeded 120,000 km, including 19,000 km high-speed rail, both the longest in the world.
The economically advantaged Jiangsu Province in east China is also speeding up railway construction in its northern part to connect all its major cities with high-speed railways.
Over the past five years, China saw an annual average economic growth of 7.8 percent, and its per-capita GDP is expected to increase to approximately 8,000 U.S. dollars from 4,516 U.S. dollars.
The number of newly employed reached about 64 million and the rural poverty-stricken population fell from 166 million to about 60 million.
China also achieved reduction targets outlined in the 12th five-year plan for four major pollutants — sulfur dioxide and chemical oxygen demand, ammonia nitrogen and nitrogen oxide, six months ahead of schedule, official statistics showed.
“Fulfilling major economic targets of 2015 will mark the smooth completion of the 12th five-year plan and allow the country to develop on a higher platform,” said a statement issued after the Central Economic Work Conference on Dec. 21.
Hu Angang, director of the center for China studies at Tsinghua University in Beijing, gave a “high score” for the implementation of the 12th five-year plan.
“The completion of the 12th five-year plan is a vital step toward completing the building of a moderately prosperous society and consolidating a basis for the country’s modernization and national rejuvenation,” he said.
He attributed the plan to better ruling by the CPC and the remarkable progress in the country’s governance system.
Because 2016 is the first year of the 13th five-year plan period it is important for China, as a good start is half the battle.
China needs to face up to the challenges ahead in achieving an average annual growth of no less than 6.5 percent over the next five years while cutting excessive capacity, treating pollution and reducing poverty.
In his New Year speech, President Xi Jinping called for confidence and hard work for a good beginning in the home stretch of building a moderately prosperous society in all respects. He urged joint efforts to lift tens of millions of rural people out of poverty.
The country’s amended law on air pollution control took effect on Friday, dealing tougher punishments to industries and seeking to curb air pollution at its root.
According to Environment Minister Chen Jining, some major pollutants must be cut by another 30 to 50 percent for remarkable improvement of environment.
On Wednesday, the country unveiled an environmental protection plan for the most polluted region, which includes Beijing, Tianjin and Hebei. Bouts of heavy smog choked the region several times this winter.
Under the guideline, in 2020, the region should realize a significant reduction of major pollutants and a 40 percent fall of the density of PM2.5 (particulate matter smaller than 2.5 micrometers) from 2013. Enditem

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Headlines: Winter economy thaws frozen Northeast China

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HARBIN, Jan. 1 (Xinhua) — The bitter cold in Northeast China’s Heilongjiang Province, powerful enough to cause frostbite, is heating up the economy of the frozen land.

Harbin’s International Ice and Snow Festival, in trial operations, is drawing global tourists with its shimmering castles, huge towers and thrilling slides, all made of ice and snow.

The largest winter festival in China, the frozen structures have been built in the provincial capital every winter since 1999, earning Harbin a fame of “Ice City.”

The park this year has been the largest ever, the size of 112 football fields. A record 330,000 cubic meters of ice and snow were used.

“The main tower, 46.5 meters high, was built with 20,000 cubic meters of ice,” Wang Zengyu, deputy general manager of the park, said. “It might be the highest ice tower in the world.”

A team of Chinese and Dutch designers spent three months in landscaping the park, which was built by more than 10,000 workers. The result is one of the most attractive festivals to date, Wang said.

The time and energy put into the festival is a sign of the hope local authorities have for winter tourism, a bright spot in Heilongjiang’s economy, which has been slowed by sagging energy and heavy industries.

Along with adjacent Jilin and Liaoning provinces, Heilongjiang has been a traditional industrial base for decades. From January to September, Heilongjiang’s economy expanded by 5.5 percent, ranking third from the bottom among China’s provinces, autonomous regions and municipalities.

However, the province’s tourism revenues grew by 35 percent during the first three quarters.

Even better growth is expected for this winter, as the popularity of winter sports is predicted to grow following the announcement that Beijing will host the 2022 Winter Olympics.

Last month, Heilongjiang provincial officials came to big cities such as Beijing, Tianjin, Shenzhen and Hangzhou to promote five new travel routes in Northeast China featuring frozen landscapes and winter activities.

In addition to tourism, Heilongjiang’s cold weather, with average January temperatures between minus 31 and minus 15 degrees Celsius, has created other business opportunities, such as mass storage of information data, among others.

Harbin is working to become a base for cloud computing, which allows users to store files in a remote data center, or “cloud,” to enable access from any computer.

The city is attractive to cloud computing companies due to its cool climate, with a yearly average temperature of 3 degrees Celsius. Low temperatures help save on the cost of operating heat sinks and other units required to keep massive banks of computers from overheating.

“According to our calculation, a data center’s power consumption here is 40 percent less than in South or Southeast China. We don’t need compressors for refrigeration for eight months a year,” said Tan Liyan, general manager of data service provider Gopha in Harbin’s cloud computing industrial park.

More than 300 companies have moved into the industrial park, named “China Cloud Valley,” since its launch in late 2010.

Companies in the park inked investment deals worth 31 billion yuan (4.7 billion U.S. dollars), official statistics said.

Hundreds of kilometers away from Harbin, Heihe City has become the first choice for auto makers and auto parts suppliers to test new products under extreme cold conditions, with roads and rivers frozen for more than 200 days a year.

Auto companies started coming to Heihe for testing in the 1980s and the local government began to provide services in 2006.

“We earned just over 100,000 yuan in our first year in 2006, now we have 20 testing grounds and are earning a lot more,” said Zhao Xinhong, general manager of Honghegu, the city’s largest vehicle testing service provider.

“Currently 80 percent of China’s vehicle tests for cold regions are carried out in Heihe,” Sun said.

Demand for the services has boomed despite an economic downturn. Chen Ying, a city official, said a record number of 75 companies brought more than 1,300 vehicles to Heihe last winter.

“As the auto market has been cooling, we should spend more on research and development to win customers,” said Deng Yongjun, an engineer with Chang’an Automobile based in Southwest China’s Chongqing. Deng’s team took 100 cars to Heihe last winter.

Once China’s industrial base, the northeastern provinces have experienced an even faster economic downturn than the rest of the country, with the slowdown in heavy industry, chemicals and the real estate sector being blamed for the sluggish growth.

The situation, however, is improving. During the first three quarters in 2015, Heilongjiang’s gross domestic product (GDP) gained 0.4 percentage point from the first half of the year.

Liaoning’s GDP expanded 2.7 percent in the first three quarters, the lowest in the nation, but higher than the 2.6 percent registered in the first half of the year. Jilin’s GDP expanded 6.3 percent, up from 6.1 percent during the first six months.

The Chinese government has been rolling out measures since 2003 to boost the region, free up private businesses and restructure state-owned enterprises.

By 2020, Northeast China is expected to achieve medium-high growth, and by 2030, it is encouraged to become an important region in sustaining national growth, one key meeting of China’s top leadership planned recently.

The leadership promised more market-oriented administration, structural reform, stimulation for innovation and entrepreneurship, and improved quality of life in the often frigid region. Enditem

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China plans more cross-border e-commerce zones

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BEIJING, Jan. 6 (Greenpost) — China will set up more cross-border e-commerce pilot zones, the State Council announced Wednesday.

The zones will attract businesses, help create jobs and nurture new business models to boost foreign trade and stimulate the economy, according to a statement released after an executive meeting of the council chaired by Premier Li Keqiang.
They will be built in cities in China’s east, center and west that have good infrastructure and a good trade and e-commerce base.
The move follows the approval of the Hangzhou cross-border e-commerce pilot zone in March last year, which is based on open information sharing between businesses, financial institutions and regulators, one-stop online financial services, smart logistics and open e-commerce credit systems.
Efficient services will help businesses cut costs, said the statement.
Following its inspections last year, the State Council cited 50 provincial regions, cities, districts and counties for good work in shantytown renovation and other major projects and promised them policy support and funding.
However, it also said more than 900 officials have been punished for inaction found in the inspections. Enditem

Business, China, Chinese circle, Exchange

Political advisors brainstorm building Chinese brands

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BEIJING, Jan. 5 (Greenpost) — Senior political advisors have highlighted the need for more world-renowned Chinese brands, after a bi-weekly consultation session Tuesday.

Members of the Chinese People’s Political Consultative Conference (CPPCC) National Committee agreed that brands are essential to showcasing the competitiveness and potential of a company or even a country, and that China does not have enough of them, according to a statement issued after the session, hosted by CPPCC National Committee Chairman Yu Zhengsheng.

They called on companies to be bolder in developing brands, but also noted immature market conditions and the lack of government support.

Attendees suggested more legislation to protect intellectual property rights and punish copyright infringement. Enditem

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Top story: China scraps approvals for first, second children

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BEIJING, Jan. 5 (Greenpost) — A Chinese couple can have two children if they like, according to a new policy.

China on Tuesday stopped requiring couples to apply for official approval before having a first or second child, following the abolition of the one-child policy.

The news came out last year, many thought they still need approval to have a second child the same as when they have the first one. But the truth is that they don’t need any approval for a second one.

The move, which entered effect immediately, was announced by the Communist Party of China (CPC) Central Committee and the State Council.
They said the approval system will be replaced by birth registrations for couples’ first and second children.
All Chinese couples have been allowed to have two children since Jan. 1, after the national legislature amended its family planning policy in late December.
A document released by the CPC Central Committee and the State Council said the nation is aiming to improve its services for women and children in both urban and rural areas.
It also called for intensified efforts to monitor and predict growth in the number of newborns.
The family planning policy was introduced in the 1970s. In 1980, the government started limiting most couples to one child. The grip gradually relaxed in the following decades. For example, rural couples were allowed to have two children if the first was a girl.
In 2013, China allowed couples to have a second child if either parent was an only child.
Tuesday’s document said the family planning policy was effective in curbing alarming growth in the nation’s population, reducing pressure on resources and the environment.
The one-child policy is estimated to have prevented 400 million births. Enditem

Editor Xuefei Chen Axelsson

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Li Keqiang urges less overcapacity, more innovation

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TAIYUAN, Jan. 5 (Xinhua) — China must put “unyielding effort” into eliminating excess industrial capacity to make way for new growth engines, especially mass entrepreneurship and innovation, Premier Li Keqiang has said.

Li made the remarks during the first inspection tour of 2016 on Monday and Tuesday in north China’s Shanxi Province, which is known for large coal reserves and output.

After visiting Taiyuan Iron and Steel Group, a world-leading stainless steel producer, Li said the steel sector is suffering badly from excessive production and flagging demand.

“China should put unyielding effort into restructuring by eliminating outdated capacity and forbidding the construction of new capacity,” he said.

Companies should take pains in enhancing technology, quality and management to expand the country’s effective supply with more quality products, Li said.

In a coal mine of Xishan Coal Electricity Group, Li took a tramcar more than 300 meters underground to talk with miners and check the company’s safety conditions.

“The coal mining sector is facing hardship it has rarely seen in the face of a serious glut and plunging prices,” he said.

Mines should take the initiative in reducing output while helping laid-off workers find new jobs, according to the premier.

Li also visited a technology park in Taiyuan with more than 200 high-tech companies.

“China has huge market potential and bright prospects; growth impetus from innovation will create new jobs,” Li said.

He vowed more government support for entrepreneurs.

The premier then went to a shantytown that will be renovated into apartment buildings this year, urging local governments to lessen people’s wait times before moving into the new buildings.

He also urged companies to innovate and take risks, after visiting a museum on ancient Shanxi merchants who played a dominant role in finance and trade during the Ming and Qing dynasties. Enditem

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China expected to attract 126 bln USD foreign investment in 2015: MOC

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BEIJING, Jan. 5 (Xinhua) — China is expected to attract 126 billion U.S. dollars worth of foreign investment in 2015, hitting an all-time high, according to the Ministry of Commerce (MOC) on Tuesday.

In the first eleven months of 2015, the total number of new-established foreign-funded enterprises amounted to 23,648, up 11 percent year on year.

During the period, actually used foreign capital in China grew 7.9 percent on year to 704.33 billion yuan. Enditem

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Direct flight links China’s Hohhot with Bangkok

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HOHHOT, Jan. 4 (Greenpost) — A direct air route opened Sunday between Hohhot, capital of north China’s Inner Mongolia Autonomous Region, and the Thai capital Bangkok, for the upcoming Spring Festival holiday.

According to the Baita International Airport in Hohhot, the AirAsia flight is scheduled between Jan. 3 and Feb. 18 to serve tourists during Spring Festival, a peak holiday period in China.

The flight takes off from Bangkok at 2 p.m. local time, and arrives in Hohhot at 7:30 p.m. local time. The returning flight departs from Hohhot at 8:30 p.m. and lands in Bangkok at midnight. The trip will take 4 hours and 30 minutes, according to the airport.

During last Spring Festival holiday, Chinese outbound group travel tourists reached 5.2 million. Thailand was the most favored destination. Enditem

Source Xinhua Editor Xuefei Chen Axelsson

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First nuclear plant in ethnic minority region begins operations

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NANNING, Jan. 1 (Greenpost) — The first nuclear power plant located in one of China’s ethnic autonomous regions began commercial operation of its first reactor on Friday.

The No. 1 reactor of the Fangchenggang Nuclear Power Plant in Guangxi Zhuang Autonomous Region can supply 24 million kilowatt-hours of electricity a day, catering to the needs of a medium-sized city, said Gong Guangchen, the plant’s spokesperson.

Based on the domestically developed CPR-1000, the No.1 reactor began generating power in October 2015. The plant’s No. 2 reactor is expected to begin operating in the second half of 2016, Gong said.

The two reactors are expected to contribute 8 billion yuan (1.2 bln U.S. dollars) to the local GDP and create 64,000 new jobs annually. They will also cut coal burning by 4.82 million tonnes and CO2 emissions by about 11.9 million tonnes every year.

China has seen rapid nuclear power growth in recent years, but it suspended approval of new programs after Japan’s Fukushima nuclear disaster in 2011. Construction projects did not resume until 2014.

China currently has operating capacity of 25.5 million kilowatts and aims to raise installed nuclear power to 58 million kilowatts by 2020 in order to reduce pollution from coal-burning generators and deliver on its promise to reduce carbon emissions. Enditem

Source Xinhua Editor Xuefei Chen Axelsson

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China’s 2015 box office soars to 6.8 bln USD

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BEIJING, Dec. 31 (Greenpost) — Films screened in China raked in more than 44 billion yuan (6.78 billion U.S. dollars) in 2015, a 48.7 percent yearly increase and the highest since 2011, the country’s film watchdog said.

Domestic films took in 27.1 billion yuan, or 61.58 percent of the total, maintaining a clear dominance over the country’s cinema market, according to a statement released late Thursday by the State Administration of Press, Publication, Radio, Film and Television (SARFT).

In 2015, a total of 81 features surpassed the 100 million yuan box office threshold, including 47 Chinese titles.

Meanwhile, Chinese films gained 2.77 billion yuan in overseas sales, up 48.13 percent year-on-year.

The country also saw a 51.08 percent increase in the number of cinemagoers, reaching 1.26 billion people.

The SARFT noted a series of high-quality domestic films, including “Monkey King: Hero is Back,” a 3D animation based on a classic ancient story, and “Monster Hunt,” a live action-animation hybrid.

“Domestic films no longer merely rely on the box office. In 2015, more films achieved both outstanding box office performances and critical acclaim,” the statement said, citing surveys conducted in key cinema seasons.

Notably, “Monkey King,” while taking in more than 800 million yuan between July and Sept., was rated 8.4 out of 10 by nearly 260,000 votes at douban.com, the country’s leading art and entertainment database site.

In addition, a total of 8,035 screens were newly installed this year, at the rate of 22 screens added every day. The total amounted to 31,627 screens. Enditem

Source Xinhua, Editor Xuefei Chen Axelsson

China, Chinese circle, News

中国驻苏丹使馆捐赠苏丹小学生校服2700套

Image 01/07/2016 北欧绿色邮报网 Leave a comment

北欧绿色邮报网报道（记者陈雪霏）－－1月7日，中国驻苏丹大使馆捐赠苏丹6所小学2700套学生服。

在苏丹喀土穆州雅尔穆克学校，学生们在捐赠仪式上与中国驻苏丹大使李连和合影留念。

当日，由中国驻苏丹使馆组织的“新希望新校服”首批校服捐赠仪式在苏丹喀土穆州雅尔穆克学校举行，当地6所贫困学校共接收绣有“中苏友谊”字样的校服2700套。
新华社记者李紫恒摄

Business, China, Chinese circle, culture, Indepth, News, Opinion, World News

Yearender: New laws, regulations make difference for China in 2016

01/03/2016 北欧绿色邮报网 Leave a comment

BEIJING, Dec. 31 (Xinhua) — Several laws and regulations will take effect in 2016, and change the day-to-day lives of the Chinese people.

From allowing a second child and making it easier for migrant workers to settle down in big cities, to measures that make the stock market more stable and market-oriented, these new rules touch on the deeper problems facing the Chinese and will go down in history.

A FAMILY AFFAIR

From the first day of 2016 the lives of tens of millions of Chinese couples will change when the amended family planning law takes effect,allowing all couples to have two children.

This historic move is part of efforts to balance the population structure.

Chen Li, who works at a public institute in northwest China’s Shaanxi Province, has always wanted a second child.

“Thanks to the amended law, my husband and I can plan for another child. My daughter will have a younger sibling, and they can take care of each other,” said Chen, who is in her forties.

China’s family planning policy was first introduced in the 1970s to rein in the surging population. For decades, most urban couples were limited to one child, while rural couples were allowed to have two children if the first was a girl.

The policy gradually relaxed as a number of social problems arose. In 2013, China began to allow couples to have a second child if either parent was an only child.

Guo Zhigang, a sociologist with Peking University, said around 35 percent of the population will be over 60 by 2050. “The new law will help balance the decreasing labor force and aging population,” he added.

CITY LIFE

The new year also brings good news for the 250 million migrant workers in cities, mainly from rural areas. They will be able to apply for residence permits that will give them better access to local public services from Jan. 1.

According to the new regulation, applicants must have lived in the city in which they are applying for residency for at least six months and either have a stable job, stable place to live or be studying.

Those granted the new residence permits will gain access to more basic public services, including nine years of compulsory education for children and basic health care. The new permits will also bring conveniences such as passport issuance and automobile registration.

“For decades, migrants have experienced inconveniences in places they work and live in because they are not locals,” said Wang Han, 31, a software engineer in Beijing. Wang came to Beijing in 2006 from the northeast province of Jilin.

Although Beijing has issued residence permits since 2003 for migrants who have made extraordinary contributions or those who are classified as urgently needed talent, Wang found it difficult to get one. “The regulation will ensure migrants have more equal access to social services received by local ‘hukou’ holders,” said Wang. In China, people with a city’s “hukou” enjoy better educational opportunities, employment support and social welfare.

A STABLE MARKET

China will introduce a circuit breaker next year in addition to the existing daily trading limit for individual stocks to ward off major swings in the country’s stock market.

Market gyrations during the summer this year ended a bull-run of Chinese stocks since late 2014 and wiped out trillions in market value.

The circuit breaker will force trading at exchanges in Shanghai and Shenzhen to suspend for 15 minutes if the Hushen 300 index falls five percent. Trading will halt for the rest of the day if the index plunges more than seven percent.

There were 25 days when the index fell over five percent between the beginning of 2014 and the end of October this year, including 11 days when the decline exceeded 7 percent, data compiled by Ping An Securities shows.

Meanwhile, new stock offerings on the domestic market will see less bureaucratic meddling as registration-based IPO rules will replace the approval-based listing process. The supply of new stocks will gradually increase and more companies can access fundraising through the stock market under more flexible listing requirements.

Under the registration-based IPO rules, regulators will only need to ensure thorough information disclosure for IPOs and let the market determine the value of new stocks rather than hand-pick companies for listing, a practice that has bred corruption among officials who get to decide on which company goes to market.

IT’S EASY TO BE GREEN

A new law on air pollution control will become effective on the first day of 2016. This new legislation was amended and passed this year amid worsening air pollution across China.

Beijing and its surrounding region in northern China were among the regions worst hit by smog containing hazardous air-borne particles measuring less than 2.5 microns in diameter, known commonly as PM 2.5.

China has made similar legislation in the past, but existing regulation has been seen as increasingly outdated and less effective in reducing pollution.

The new law metes out tougher punishments to industries and seeks to curb air pollution at its root.

In the past, companies and organizations that failed to comply with legal requirements on air pollution faced fines of up to 500,000 yuan (around 80,600 U.S. dollars). That limit is gone in the new law, in the hope that reckless polluters will no longer be able to afford to pollute.

The new law also mandates that gasoline be produced at a higher quality and alternative energy used to reduce coal consumption.

Local governments will also be assessed and monitored over what they do to improve air quality. They have largely ignored environmental protection in the past in their growth-at-all-cost approach to economic development. Enditem

Business, China, Chinese circle

Spotlight: China’s “supply-side structural reform” to solidify bedrock for sustainable development

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BEIJING, Dec. 31 (Xinhua) — China’s supply-side structural reform holds the key to its structural adjustment in the short term and will solidify the bedrock for the sustainable development of its economy in the long run, overseas experts have observed.

Marking a crucial year for China to comprehensively deepen its reforms, 2015 saw the birth of its development blueprint for the next five years amid a decelerated domestic economy and an unstable global one.

At a recently concluded key economic meeting in Beijing, the Chinese government pledged to take steps to push forward a “supply-side structural reform” in 2016 and beyond to support growth through new demand and productivity.

China’s announcement of a supply-side structural reform came at a critical moment, and is considered as an innovative move to guide the world’s second-largest economy under the “New Normal” and a proactive decision to make it internationally more competitive.

NEW IDEAS, NEW MOMENTUM

The choice of supply-side structural reform indicates that China does not intend to employ traditional stimulus measures, Ulises Granados, professor of international relations at Mexico Autonomous Institute of Technology, told Xinhua.

It shows that China is seeking an innovative way to stabilize growth and adjust its economic structure with fresh ideas, thus trying to find a new path for its sustainable economic development, the scholar added.

The Japanese newspaper Nikkei said in a recent report that China’s push for a supply-side structural reform is markedly different from the massive stimulus policies used since the outbreak of the Lehman crisis that triggered the financial earthquake in the global market.

Under the “New Normal,” flooding stimulus measures would no doubt boost economic growth in the short term but not be able to increase potential growth with an ideal rate, while risking huge waste.

The International Monetary Fund said the decline of the global potential growth rate was the major contributor to the sluggish recovery of the world economy.

Figures showed that the average potential growth rate of the emerging economies between 2008 and 2014 was 6.5 percent, 2 percentage points lower than the level before the financial crisis.

As its population dividend dwindles and land resources become more scarce, China’s potential growth rate has also shrunk. However, this leaves room for a supply-side structural reform under the “New Normal” that aspires for more sound growth.

MORE EFFICIENT, BETTER GROWTH

Further shifting China’s focus on the quality instead of quantity of the economy, a supply-side structural reform attaches more importance to structural adjustment and innovation in technology and the system in a bid to make the economic structure more efficient.

The Indian newspaper Economic Times paid attention to China’s reformative move.

“As the effectiveness of boosting growth on the demand side, the government has started to reform the supply-side to make effective use of production factors, including funds, resources, skilled workers, equipment and technologies,” it quoted China Daily as saying in a recent report.

El Pais, a Spanish newspaper, noted that China is attempting to shift its growth model from one dependent on exporting low value-added products and government investment to one driven by domestic demand, innovation and the service industry.

In addition, overseas experts have observed that China’s implementation of the supply-side structural reform also serves its long-term need of sustainable development as well as avoiding the “middle-income trap.”

According to the World Bank standard, China has already become a middle-income country, but a higher ranking requires the Asian nation to register a per capita GDP higher than 12,000 U.S. dollars and escape the so-called “middle-income trap.”

Data revealed that since 1960, out of 101 countries and regions which had managed to be categorized as middle-income economies, only 13 became high-income ones later.

Those that did not reach the high-income category had failed to achieve a technological breakthrough, make economic structural adjustments or innovate their systems. However, a supply-side structural reform may be the answer.

Peter Drysdale, economist and editor at the East Asia Forum at the Australian National University, was confident about China’s progress, describing its transition as “so far so remarkably good.”

Despite the massive size of the country, “China has enjoyed a faster transition to middle income than any country before it,” he said. Enditem

Business, China, Chinese circle

China Focus: Chinese shares end 2015 with one pct fall

01/03/2016 北欧绿色邮报网 Leave a comment

BEIJING, Dec. 31 (Xinhua) — China’s benchmark Shanghai Composite Index ended the year of 2015 with a decline of 0.94 percent amid shrinking turnover on December 31, closing at 3,539.18 points on Thursday.

The benchmark index went up 9.41 percent in the whole year of 2015 with the peak point at 5,178.19 points seen on June 12.

In 2015, the Index recorded an over five-percent intraday rise in three trading days and a more than eight-percent fall in five trading days, according to statistics from Shanghai Securities News.

Balance of intraday margin deposits in accounts for securities trading on Shanghai and Shenzhen bourses averaged 1.15 trillion yuan at the beginning of 2015 and it climbed to as high as 3.3 trillion yuan in the middle of the year. By December 30 2015, the accumulated trading turnover on the two bourses totaled 253 trillion yuan, over three times more than that in 2014.

The number of investors traded on Shanghai and Shenzhen stock exchanges jumped from some 71 million yuan at the beginning of the year to 98.62 million yuan by December 30.

At earlier 2015, the balance of margin financing business on the two stock markets stood at some one trillion yuan and soared to a peak of 2.2 trillion yuan within the year. It went back to a bit over one trillion yuan at the end of the year.