Press briefing on H1 economic data

Beijing Times:

I have two questions: One, could you help us analyze the proportions of investment, consumption and exports in GDP? Two, you felt the innovative industries have performed well, but could you talk more about the old industrial bases? Such as those places which rely on coal and steel, have you analyzed the economic situations there? Is China's economy growing to be more and more unbalanced? Thanks!

Sheng Laiyun:

As for the question about the proportions of the three types of demand in GDP growth, in the first half of the year, consumption eventually contributed 54.4 percent to GDP growth and helped GDP increase by four percent; fixed capital contributed 48.5 percent and helped GDP increase 3.6 percent. The contribution of the net exports of the cargo and service industry was minus 2.9 percent and caused a 0.2 percent decrease in GDP.

As for the adjustment and transformation of the old industrial bases, in the first half of the year, the trend was that part of the old industrial bases, especially the traditional chemical industry or raw material industries faced huge challenges. In some provinces, economic growth declined. The decline was partly due to the serious excess production capacity in traditional industries. These industries faced relatively bigger challenges during market adjustment. These places faced greater pain from the adjustment and transformation of economic growth.

Another thing I want to emphasize is that the growth decline in old industrial bases in several provinces was also related to the actions of the local provincial governments, which actively adjusted the industrial structures and adopted new models according to the central government's requirements. Looking at it this way, the old industrial bases were facing short-term decline due to the transformation and our active adjustment and actions in terms of market demand. So we believe that as long as we handle well the relationship between stable growth, restructuring and promoting reform, the old industrial bases will be revived and their economic growth will increase at a medium or fast rate. Since these places are mostly regions that have not completed industrialization and urbanization, they have obvious potential for the future. They have the potential and conditions to continue mid-or-high-speed growth. The key is how they can overcome the pressure from economic restructuring and transformation of the economic development mode. Thanks!