To lift economic pressure, help migrants

Updated: 2016-07-15 08:07

By Ed Zhang(China Daily Europe)

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Cities that seek high-skilled elites while excluding all others risk their competitive niche and cultural uniqueness

China was to release its official economic statistics on the first half of the year on July 15. Yet the growth rate will no longer attract investors' attention, as the situation has stayed more or less the same since last year, while the diverse forecasts and assessments are only fractionally different, no more than 0.5 percentage points.

The second-quarter results will be lackluster, most likely the weakest in seven years, according to some analysts.

Of late, more indexes have been introduced. More sectors of the economy, which were possibly hard to measure before, are re-measured. But they can't change the broad picture: we're in a protracted slowdown process.

To lift economic pressure, help migrants

Investors want to know how long the process is going to last, but no one appears to have a clear idea at the moment. Some people have gone so far as to say it will perhaps be comparable with Japan's so-called lost decade, although China's per capita GDP is at a much lower level than Japan's was at the start of its slowdown.

Other people believe that individual countries can do very little about it now that the whole world is in a low cycle of productivity growth. These countries will just have to wait for the world market to get robust again, they say.

This may explain in part why the recent decline in the yuan's exchange rate against the dollar didn't translate into currency outflows: Things are becoming too expensive overseas in relative terms, and there aren't many really good things to buy.

So for the rest of the year, according to some sources in Beijing, all the central government can do is to continue providing relatively easy money supply, just to keep China's annual growth rate from falling below 6.5 percent, the lowest level of the government's band of acceptability.

Having said this, however, it shouldn't mean that on a strategic level China doesn't need to make an effort. Economic reform is something the country has always drawn credibility from over the past 30 or so years. And of the many items on the reform to-do list that the central government adopted in 2013, little practical progress has been achieved as yet.

To lift economic pressure, help migrants

At the very least, municipal governments have been slow in helping migrant workers and their families to settle down in cities. Many cities are apparently operating on conflicting policies; they are setting up barriers to what they regard as low-skilled workers to make room for the high-skilled talent they expect, although it's common sense that for every top-level professional to fully realize his or her function, there must be more workers to provide needed, but not high-skilled, services.

Beijing is an example. A quiet campaign seems to be going on in the Chinese capital to drive away small merchants and the colorful services they provide - one shop after another, one market after another, and one street after another - apparently under some sort of plan by city officials to reduce the number of low-skilled residents.

The capital already has a registered population three times the size of Switzerland. Yet trying to bring population growth under control is beside the point, and doing so simply for the sake of control runs counter to the logic of the reform. It's not to include more people, or to generate more opportunities, or to improve the quality of life even for the high-skilled workers it is looking for.

Technological experts are not robots - they also appreciate a cheap bowl of Chongqing noodles or a plate of stir-fried pasta for lunch.

The setback in urbanization is not seen only in Beijing. When all cities are advertising for high-skilled elites and shutting their doors to low-skilled and mid-skilled young workers, they may actually end up destroying their cities' competitive niche and cultural uniqueness.

More importantly, at a time of a general slowdown, city bureaucrats are using their ill-advised policies to add, rather than alleviate, the economy's downward pressure.

The author is an editor-at-large of China Daily. Contact the writer at

(China Daily European Weekly 07/15/2016 page14)