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Opinion / Opinion Line

Forget fears, economy is alive and kicking

(China Daily) Updated: 2016-01-30 08:17

Forget fears, economy is alive and kicking

Workers manufacture garment that will be exported to the European Union in Huaibei city, Anhui province, Dec 8, 2015. [Photo/IC]

Editor's note: China's GDP growth in 2015 slowed to 6.9 percent year-on-year, sparking mixed reactions at home and abroad. Following are three distinct comments by media outlets:

The 6.9 percent growth was within people's expectations, given the increased downturn pressure on China's economy as revealed by fluctuating macroeconomic data last year. The growth, however, was also beyond expectations because some predictions put it at an even lower level, which was indicated by the positive stock market response after the data were released.

Although last year China's growth rate slipped below 7 percent for the first time in a quarter century, it was within the parameters set by the Chinese authorities.

Premier Li Keqiang has said that instead of obstinately trying to maintain a very high growth rate, China will see to it that the economy grows reasonably well.

Because of the huge size of China's economy, the additional output from the 6.9 percent growth is equivalent to that of a middle-sized economy and higher than the additional value produced by the two-digit growth rate of previous years. That's why despite aiming for a high growth rate, we should also realize that with China's economy having already expanded considerably, it is natural for growth to register a gradual decline.

A simple comparison of growth rates during different periods could lead to fallacious conclusions. For a $2-trillion-plus economy, a 2.5 percent growth rate is considered high. So a 6.9 percent growth for the about $10-trillion Chinese economy should be considered very high. This is to say that people should not rack their brains over a little higher or lower than 7 percent growth and, instead, welcome a moderate economic growth as China enters the "new normal" stage.

After three decades of fast-paced growth, China today is quite different from what it was in the 1990s in its economic fundamentals, development model, industrial landscape and driving force. The national economy, too, has undergone notable changes both in terms of quantity and quality. It's time, therefore, for China to focus on economic governance instead of blindly pursuing a high growth rate.

China Business News

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