Interview: EU official sees no hard landing for Chinese economy

The moderate economic slowdown in China is the result of the country's bid to restructure its economy and should not be a reason for alarm that the Chinese economy is moving toward a hard landing, a senior official from the European Union (EU) told Xinhua.

"Our prediction (for the Chinese economy) is for a modest deceleration of growth to around 7 percent in 2015," said Rupert Willis, desk officer for China in the Directorate General for Economic and Financial Affairs of the European Commission, in an interview.

As he sees it, the fear for a hard landing of the Chinese economy is only well founded when a sharper slowdown happens with growth rate falling below 6 percent within a year or two.

The notable gap between China's trade growth in 2014, which stood at 3.4 percent, and the 7.5 percent target has also been seen by some as evidence of what they alleged a dubious future for the Chinese economy.

When asked to comment on the deceleration of China's foreign trade, Willis emphasized that net exports have contributed very little to China's growth since 2010. "Growth is driven primarily by domestic demand, not by net exports. So continued rapid growth in China does not really depend on rapid export growth."

For macroeconomic reasons, Willis said reforms in the following areas seem to be of particular importance for China: to improve the fiscal system for a better match of spending and revenue on local levels, to avoid the buildup of bad debts linked to poor quality investments, to further open up key sectors so as to boost efficiency and innovation.

Willis also underlined the need for China to advance the rule of law in the business sphere, saying measures should be taken to create a level playing field for all participants. Endi