“Now the impact of the financial crisis on China’s economy has been pushed from the export-oriented industry to the inward-looking industry. The pressure on China’s economic downturn is huge, and the difficulties and challenges are unprecedented.†On December 20, Yao Jingyuan, chief economist of the National Bureau of Statistics, said “ The annual meeting of Fudan University in 2009 stated.
The situation will be more severe next year
“The financial crisis has continued to deteriorate, and its impact on China has started with exports that affect China. Last year, exports accounted for 40% of China’s total economic output. Its contribution to the Chinese economy cannot be ignored.†Yao Jingyuan pointed out, “This year The impact of the financial crisis on China’s export industry will be mainly in the coastal cities in the southeast, and the impact on the central and western regions will gradually emerge next year. Therefore, China’s external demand will be more difficult next year and even further affect domestic demand.â€
Lu Zhongyuan, deputy director of the Development Research Center of the State Council, also expressed the same view: “The cyclical fall in domestic demand and the fall in external demand are intertwined. The export situation is rather severe. From the end of this year to the beginning of next year, the Midwest will be affected by the financial crisis. Therefore, 2009 The situation we face in the year will be even more severe."
Lu Zhongyuan also pointed out: "Last year, when the asset bubble was too large, we called for a correction in the stock and property markets, but now the stock market correction is too large. Although the property market does not have a problem of excessive callbacks and needs further correction, it must be prevented from overlapping with the stock market correction. At present, another serious challenge we face is how to restore the confidence of the asset market."
Internal growth potential is huge
"Although China's domestic demand has dropped, we have to see that the decline in domestic demand is mainly caused by a reduction in investment. The domestic residents' consumption is still rising steadily, and the annual total retail sales will maintain a growth rate of 1%. It is very difficult to stimulate consumption growth in the short term. It's better to pull investment into effect faster, so our current problem is how to stimulate investment growth in the short term, and to stimulate consumption is what we have to solve in the medium to long term,†said Lu Zhongyuan.
As for the RMB exchange rate issue, the principle of the Central Plains said: "The RMB exchange rate should remain stable and should not be devalued. Of course, it should not be appreciated. Once the RMB is devalued, it will lead to a large outflow of hot money, but it may not be able to stimulate exports positively, even It may cause international competitive devaluation, so that the devaluation of the renminbi will have no meaning. At present, the renminbi exchange rate should have a downward trend and expand the range but it does not necessarily depreciate."
Hua Min expressed a similar view: "In the current economic situation, the exchange rate of the renminbi must remain stable. The devaluation does not stimulate exports because the current decline in exports is caused by a decline in global demand, which has nothing to do with the exchange rate. More impracticable, China's economic fundamentals are still unable to support the internationalization of the renminbi."
Lu Zhongyuan also expressed his confidence in the Chinese economy in 2009: “The potential for internal growth in the Chinese economy is still huge. It is expected that economic growth will reach 9% in 2009, and consumer prices will increase by 2%-3%. Next year, the overall economy of China will enter a rest period. The type of adjustment for China's economy depends on time, internal potential and external environment, and I personally prefer U-shaped adjustment."
The situation will be more severe next year
“The financial crisis has continued to deteriorate, and its impact on China has started with exports that affect China. Last year, exports accounted for 40% of China’s total economic output. Its contribution to the Chinese economy cannot be ignored.†Yao Jingyuan pointed out, “This year The impact of the financial crisis on China’s export industry will be mainly in the coastal cities in the southeast, and the impact on the central and western regions will gradually emerge next year. Therefore, China’s external demand will be more difficult next year and even further affect domestic demand.â€
Lu Zhongyuan, deputy director of the Development Research Center of the State Council, also expressed the same view: “The cyclical fall in domestic demand and the fall in external demand are intertwined. The export situation is rather severe. From the end of this year to the beginning of next year, the Midwest will be affected by the financial crisis. Therefore, 2009 The situation we face in the year will be even more severe."
Lu Zhongyuan also pointed out: "Last year, when the asset bubble was too large, we called for a correction in the stock and property markets, but now the stock market correction is too large. Although the property market does not have a problem of excessive callbacks and needs further correction, it must be prevented from overlapping with the stock market correction. At present, another serious challenge we face is how to restore the confidence of the asset market."
Internal growth potential is huge
"Although China's domestic demand has dropped, we have to see that the decline in domestic demand is mainly caused by a reduction in investment. The domestic residents' consumption is still rising steadily, and the annual total retail sales will maintain a growth rate of 1%. It is very difficult to stimulate consumption growth in the short term. It's better to pull investment into effect faster, so our current problem is how to stimulate investment growth in the short term, and to stimulate consumption is what we have to solve in the medium to long term,†said Lu Zhongyuan.
As for the RMB exchange rate issue, the principle of the Central Plains said: "The RMB exchange rate should remain stable and should not be devalued. Of course, it should not be appreciated. Once the RMB is devalued, it will lead to a large outflow of hot money, but it may not be able to stimulate exports positively, even It may cause international competitive devaluation, so that the devaluation of the renminbi will have no meaning. At present, the renminbi exchange rate should have a downward trend and expand the range but it does not necessarily depreciate."
Hua Min expressed a similar view: "In the current economic situation, the exchange rate of the renminbi must remain stable. The devaluation does not stimulate exports because the current decline in exports is caused by a decline in global demand, which has nothing to do with the exchange rate. More impracticable, China's economic fundamentals are still unable to support the internationalization of the renminbi."
Lu Zhongyuan also expressed his confidence in the Chinese economy in 2009: “The potential for internal growth in the Chinese economy is still huge. It is expected that economic growth will reach 9% in 2009, and consumer prices will increase by 2%-3%. Next year, the overall economy of China will enter a rest period. The type of adjustment for China's economy depends on time, internal potential and external environment, and I personally prefer U-shaped adjustment."
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