No need to hype China's weak figures
Updated: 2014-09-17 10:05
BEIJING - Much fuss has been made about the latest disappointing economic indicators, just as when weak data in the first quarter pointed to growth below China's annual target.
The pessimism among market watchers seems well-founded, as industrial output grew at the lowest pace since December 2008 in August. Electricity production, automobile and property sales and the foreign direct investment were all weaker than expected.
In some media commentators' views, the economy is in such a critical state that China will certainly miss the annual growth target unless strong stimulus measures are taken. But make no mistake about it, a strong stimulus is the diametric opposite of what the Chinese government wants and what the economy needs.
The concept of a "new normal" for the world's second largest economy is now prevailing both at home and abroad, as the indomitable growth of the three decades since 1978 is no longer feasible. New normal China is less interested in growth rates and more interested in quality and efficiency of growth: pushing forward reform, adjusting structure and trying to benefit the people.
Reform since the beginning of the year has been non-stop, including streamlining company registrations, speeding up shantytown renovation and making credit easier for the agricultural sector and small businesses. The measures not only showed the government's resolve to balance reform and growth, but laid the foundation for quality growth in the long haul.
Easier company registration has helped entrepreneurs create jobs. Newly registered companies are up 61 percent year on year in the March-Aug period.
It is worth mentioning that macroeconomic controls target growth of around 7.5 percent this year. China's annualized GDP expanded 7.4 percent in the first half of this year with a slightly stronger second quarter.
With a long-term target in mind and sufficient policy weapons in the arsenal, a temporary slowdown could be more of an opportunity to pursue structural optimization than a reason for panic.
As the economy gears down and breakneck growth becomes a thing of the past, the international community will just have to learn to get along with new, normal China.
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