China’s latest Economic Figure

(In an interview with CCTV Biz Asia, Pro. Zhu Ning, Deputy Director of SAIF, analyzed China's latest Economic Figure.)

The policy makers have been doing whatever they can think of right now. They have been now pushing through a few of fine economic policies trying to fighting or boost the economy. However, in the intermediate or to the long term, the policy makers would have to think hard about what is the best way to push forward some of the tougher reform actions. They want to think more carefully about how to provide more infrastructures and how to reform the taxation fiscal system. So that the population would have more expendable income, which will further boost domestic consumption, which will make the Chinese economy less rely on export and on the international market.

If you look at China from a foreigner's prospective, China's cost of living or cost for labor has increased dramatically in the past few years, which makes it less attractive to foreign investors. At the very same time, it is worse noticing that most of the FDI in the past quarter came from Europe. This is somewhat ironic; it is partly because the European economy is doing poorly than the European investor turning their attention away from Europe for a moment. But if the situation could change, it may be improving or becoming worse, European investors may turn their attention back to Europe, which may drive away some of the FDIs coming into China in this pasts quarter.

The number may surprise some people by barely making or barely missing the 8% target, which is usually used as a gage for the health of the economy. However, at this moment, making or missing the 8% target is not that important. In the long term stability of the economy and the followed reform of the economic and financial policies are really critical to the long term economic growth of China.