The Value of China's Economic Growth in the First Half of 2019
In the first half of this year, China's economy grew by 6.3% and continued to operate within a reasonable range. Public wellbeing improved continuously, transformation and upgrading progressed steadily, the stamina of development continued to strengthen, and new progress was made toward high-quality growth, thereby laying sound foundations for meeting this year's economic and social development targets. The growth rate of 6.3% did not come easily, but was achieved despite decelerating global economic and trade growth and mounting downward pressure on China's economy. It was a result of our efforts to boost supply-side structural reform, create new methods of macro-control, improve the business environment, slash taxes and fees, and unleash the vitality of market entities. Ranking high among the world's major economies, this growth rate comes from overall stable employment, basically steady prices, and constantly enhanced economic quality, thus being both sustainable and enduring. Featuring a high level of quality and value, this growth rate shows that China's economy remains stable overall with a positive trend.
I. Production demand grew steadily, and development became significantly more resilient.
During the first half of this year, in line with the guiding principles of the Central Economic Work Conference and the arrangements of the Report on the Work of the Government, we effectively implemented a proactive fiscal policy, a prudent monetary policy, and an employment-first policy, opened up at a higher level and with greater intensity, took solid steps to slash taxes and fees, and gradually reduced enterprise financing costs. Taking a strong and effective stance against internal and external challenges, China's economy grew rapidly from a large base figure, and continued to operate within a reasonable range.
1. China's economic growth ranked among the highest in the world. For a large economy, its growth rate is closely related to its size – the larger the size and base figure, the more difficult it is to achieve rapid growth. In 2018, China's GDP exceeded 90 trillion yuan, or US$13.6 trillion as calculated at the yearly average exchange rate, ranking second globally and accounting for nearly 16% of the world economy. Based on the relatively large size of its economy, China's GDP saw a year-on-year increase of 6.3% in the first half of this year, maintaining a medium-high growth rate. China's economic growth ranked high among the world's major economies, which was particularly striking against a backdrop of decelerating global economic growth, growth for which China continued to be an important engine. This growth rate means that China's economic growth in a single year is equal to the entire economy of a medium-sized developed country. In a complex and daunting international environment and facing considerable downward pressure on the domestic economy, China's economy has been able to maintain a growth rate of more than 6%, indicating that China has the conditions, ability, and confidence to surmount all risks and challenges and achieve its main goals for economic and social development.
2. Industries continued to develop. The rural revitalization strategy was fully implemented, agricultural supply-side structural reform was actively advanced, and agricultural production remained favorable with a bumper summer grain harvest. In the first half of this year, the value added of the primary industry saw a year-on-year increase of 3%. The summer grain output was 141.75 million metric tons, an increase of 2.95 million metric tons or 2.1% over last year, equaling the record high of 2017. The output of summer grain per mu (0.067 hectare) was 359 kilograms, a year-on-year increase of 3.5%. We worked hard to slash taxes and fees, intensified financial support for the real economy, and gradually improved the business environment, which effectively eased pressure on industrial production. In the first half of this year, the value added of industrial enterprises, each with an annual income of 20 million yuan or over and hereafter referred as large-scale enterprises, saw a year-on-year increase of 6%; 39 out of 41 major types of industries maintained year-on-year increases in value added; 366 out of 605 major industrial products, or 60.5%, achieved year-on-year increases in output. The service industry continued to grow quickly while transformation and upgrading also accelerated; its value added in the first half of this year saw a year-on-year increase of 7%, which was remarkably faster than that of the manufacturing industry; and its business activity index flourished at above 53%.
3. Consumer demand grew amidst stability. With a population of nearly 1.4 billion, China is home to the world's largest middle-income group and boasts a huge market. In addition, we have gradually increased effective supply according to consumer demand in order to create favorable conditions for the expansion of consumer spending. In the first half of this year, total retail sales of consumer goods rose by 8.4% year-on-year, with consumption of services such as education, health, elderly care, sports, and tourism growing strongly. The numbers of tourists and revenue from tourism during the Qingming Festival and May 1st Labor Day holiday periods both maintained double-digit growth. We focused our efforts on economic weaknesses to accelerate the development of major projects, removed invisible barriers to private investment, and promoted transformation and upgrading of the manufacturing industry, thus stabilizing investment growth. In the first half of this year, investment in fixed assets (excluding that of rural households) grew by 5.8% year-on-year, with investment in the manufacturing sector and in infrastructure increasing by 3% and 4.1% respectively. China has upheld multilateralism, resolutely safeguarded free trade, and steadily developed economic and trade relationships with all countries. In the first half of this year, the total import and export of goods increased by 3.9%, with export maintaining the faster growth rate of 6.1%.