In the middle of the year, as usual, an important economic work conference will be held to set the tone for economic work in the second half of the year.
In recent years, the Politburo of the Central Committee has held meetings in late July to analyze and study the economic situation and make arrangements for economic work in the second half of the year.
According to the analysis of CBN, the top priority of China’s economy is still stable growth. In an uncertain environment, maintaining a relatively good speed. The next macro policy orientation will also maintain a certain level of growth. The prime position.
In the second half of the year, a number of new policies to expand domestic demand and promote consumption are expected to be introduced, further enhancing the endogenous driving force of the economy.
In addition, this year's fiscal expenditure, which has been significantly post-positioned, is expected to begin to increase in the third quarter.
Stable growth is still the top priority
Since the beginning of this year, the macro policy has maintained the necessary support for economic recovery, the main macro indicators are within a reasonable range, and China's economic development has shown a stable and stable strengthening and stable and positive trend.
From the perspective of major economic indicators, the macro economy not only maintained the basic pattern of the first recovery of production and supply, but also showed a good trend of follow-up and recovery of market demand. The economic cycle was gradually unblocked and the economic structure was continuously optimized.
In the first half of this year, the contribution rate of domestic demand to economic growth reached 80.9%, an increase of 4.9 percentage points from the first quarter.
The contribution rate of final consumption expenditure to economic growth reached 61.7%, 42.5 percentage points higher than the total capital formation.
In terms of investment, high-tech investment with strong momentum, investment in social sectors that make up for shortcomings, and private investment that reflect market vitality have all increased rapidly.
In terms of exports, in the first half of the year, the scale of my country's import and export of goods trade hit the highest level in the same period in history. Since June last year, it has achieved positive year-on-year growth for 13 consecutive months.
Wang Jun, chief economist of Centaline Bank, said in an interview with a reporter from China Business News that given the current unsynchronized and unbalanced economic recovery, there are still many challenges and uncertainties for sustained stable and healthy growth in the future. China's economic growth momentum will weaken in the second half of the year. The risk of economic growth falling too fast to the potential economic growth level (5% to 6%), and the pattern of structural differentiation and uneven cold and warm will continue.
Wang Jun said that the main contradiction on the supply side is supply constraints and rising costs, and the main contradiction on the demand side is high leverage and weak consumption, both of which limit economic growth in the second half of the year.
It is expected that the actual GDP growth rate in the third and fourth quarters will weaken quarter by quarter, and will be roughly 8.5% for the whole year.
Ma Guangyuan, deputy director of the Central Economic Commission of the China Democratic National Construction Association, also believes that the data in the first half of the year show that the top priority of China's economy is still to stabilize growth and maintain a relatively good speed in an uncertain environment, which is good for the 14th Five-Year Plan. This is the most important step for high-quality development.
The most important risk to the Chinese economy at the moment is the decline in economic growth. The next macro policy orientation is also to maintain a certain growth in the first place.
This year, my country has set the expected target of economic growth at 6% or more. Not only does it take into account that the current economic growth is restorative, it must further consolidate the foundation for development, but also consider the smooth convergence with the target for next year and the following year.
At the Economic Situation Symposium held by the State Council on July 12, Premier Li Keqiang repeatedly emphasized the need to "keep the economy running within a reasonable range, and in particular insist on'employment priority'".
It is proposed that the current inter-cyclical adjustment must adhere to interval adjustment, and the purpose of interval adjustment is to keep the economy operating within a reasonable interval.
"Development is still the key and foundation for solving all the problems in China." Li Keqiang said, "At present, the pressure on employment in cities and towns in our country is still great. At the same time, the people's expectations for income growth are also rising. If the economy does not maintain a stable and healthy operation, employment Income growth is difficult to achieve."
The Director of the Comprehensive Department of the National Development and Reform Commission and spokesperson Yuan Da said at a press conference of the National Development and Reform Commission on the 19th that the next step is to coordinate economic operations in the second half of this year and next year, implement scientific and precise macro-control, and maintain the continuity, stability and sustainability of macro-policy. To prevent and control the epidemic, continue to deepen supply-side structural reforms, focus on expanding effective domestic demand, vigorously support the development of the real economy, unswervingly promote reform and opening up, and further strengthen basic people’s livelihood protection, especially for economic recovery. Facing new situations and new problems, we should take effective measures in a timely manner and strive to keep the economy running smoothly within a reasonable range.
"With the implementation of various policies and the further manifestation of their effects, we are fully confident, capable, and capable of achieving the annual economic and social development goals and tasks." Yuan Da said.
Domestic demand support is expected to increase
As the main engine driving China's economic growth, consumption has improved quarter by quarter since the beginning of this year, but the recovery is still not as good as expected.
In the first half of this year, the total retail sales of consumer goods increased by 23% year-on-year, and the contribution rate of consumption to GDP growth rebounded to 61.7%.
Compared with 2019, the total amount of social zero in the first half of the year increased by 9%. Among them, the first quarter increased by 8.5%, the second quarter increased by 9.4%, and the second quarter increased by 0.9% compared with the first quarter.
Wang Jun told China Business News that there are both structural problems that restrict consumption, as well as the difficulty of sustained growth in total volume.
The epidemic's constraints on consumption still exist. Affected by negative factors such as income differentiation, savings diversion, and real estate squeeze, residents' consumption sentiment is still cautious and their willingness to save is still strong.
At the press conference of the State Council Information Office on July 22, Zhu Xiaoliang, Director of the Department of Market Operation and Consumption Promotion of the Ministry of Commerce, said that there are still some outstanding problems in the current operation of the consumer market, such as unbalanced restoration and unstable foundation.
As my country's economy continues to recover steadily, epidemic prevention and control have become more precise and effective, various policies and measures have taken effect, and residents' consumer confidence has gradually increased. We expect that the overall consumer market will continue to improve in the direction of recovery.
The Ministry of Commerce pointed out that in the second half of the year, policies and measures to promote consumption will be further improved. While implementing the policies and measures that have been introduced to stabilize and expand automobile consumption, and boost bulk consumption, it will conduct in-depth investigations and studies in accordance with changes in the situation and tasks, and reserve one. Approval of new policies to expand domestic demand and promote consumption.
The automobile industry is an important pillar industry of the national economy, with a long industrial chain and strong driving effect. It is the "big head" of expanding domestic demand and stimulating consumption.
In recent years, the proportion of automobile retail sales in the total retail sales has been around 1/10.
In the government work report this year, it is proposed to stabilize the bulk consumption of automobiles and to remove unreasonable restrictions on the transaction of second-hand cars.
Zhu Xiaoliang said that the Ministry of Commerce will work with relevant departments to carefully complete the major article on the promotion of automobile consumption across the entire chain, and accelerate the construction of a new development pattern of the automobile market featuring cascading consumption, efficient use, and green recycling.
Specifically, the first is to accelerate the transformation of automobile purchase management to the use management; the second is to deepen the reform of decentralization and service in the field of automobile circulation; the third is to promote the removal of unreasonable restrictions on second-hand car transactions, and to further facilitate the transfer of second-hand cars in different places; Improve the relevant management systems in the field of automobile circulation, speed up the revision of the "Management Measures for the Circulation of Second-hand Vehicles" and the "Regulations on Compulsory Scrap Standards of Motor Vehicles" to optimize the automobile consumption environment.
After the local economic semi-annual reports were released one after another, various localities met intensively to plan the layout of economic priorities in the second half of the year, among which promoting consumption and expanding domestic demand became the top priority of economic work in the second half of the year.
For example, the Standing Committee of the Chongqing Municipal Party Committee held a meeting on July 19 and pointed out that efforts should be made to promote consumption recovery, vigorously improve the consumption environment, increase the supply of high-quality services, develop new consumption hotspots, and continuously release consumption potential.
Fan Ruoying, a researcher at the Bank of China Research Institute, said that in the second half of the year, domestic demand support is expected to increase, and the endogenous driving force of the economy will be further strengthened.
On the one hand, the domestic epidemic prevention and control situation is relatively good, employment and income levels have continued to improve, and corporate profitability has improved significantly, which is conducive to the continued stable recovery of consumption and investment.
On the other hand, the role of domestic demand in stimulating economic growth will be further enhanced, and the effects of a series of policies to promote consumption and stabilize investment will continue to appear.
The third is that a proactive fiscal policy and a prudent monetary policy will maintain strong support for the economy.
Fiscal policy stepped up to improve efficiency
The Chinese economy is expected to maintain a sustained and stable recovery in the second half of this year.
Liu Aihua, spokesperson for the National Bureau of Statistics, said on the 15th that the economy continued to recover steadily in the first half of this year, and the supply and demand cycle was smooth, laying a solid foundation for economic operations in the second half of the year.
Judging from the factors affecting the economic trend in the second half of the year, the factors supporting the further recovery and improvement of the economy on the whole are gradually accumulating and increasing.
Ma Guangyuan said that the continuity of the policy must be maintained. For the series of response measures introduced since last year, do not rush to withdraw, especially the fiscal and taxation policy that supports small, medium and micro enterprises.
Considering that this year is the first year of the 14th Five-Year Plan, various policies should make a good start and start well for the 14th Five-Year Plan, and lead to the path of high-quality development. This means that much of China’s past has become bigger and bigger. Strong-scale policies must be gradually withdrawn.
This year's fiscal expenditure, which has been significantly post-positioned, is expected to start to increase in the third quarter.
Wang Qing, chief macro analyst at Oriental Jincheng, said that the fiscal revenue and expenditure data in the first half of the year have obvious characteristics of "reserved space", which is reflected in the high growth of fiscal revenue, while the growth rate of expenditure is slow, and the expenditure progress is the slowest in years.
This "dislocation of revenue and expenditure growth" is mainly due to the sharp economic rebound in the first half of the year and the decline in demand for stable fiscal growth; while the momentum of economic recovery or marginal slowdown in the second half of the year, the policy needs to reserve spending space for stable growth, which is also an improvement. The direct reason for the significant delay in the issuance of new local government special bonds in half a year.
The progress of local government debt expenditure this year has been relatively slow.
From January to June, local governments across the country have issued 1.48 trillion yuan in new local government bonds, and the scale of new local government bonds in 2021 will be 4.47 trillion yuan.
This means that only one-third of the issuance progress in the first half of the year, and nearly 3 trillion yuan in new local bonds to be issued in the second half.
Luo Zhiheng, deputy dean of the Yuekai Securities Research Institute, told CBN that in the second half of the year, the issuance of new bonds by local governments will be accelerated, and infrastructure investment will be promoted to stabilize economic growth.
In order to maintain the stable operation of the economy, a proactive fiscal policy must still handle the balance between economic and social risks and fiscal risks.
We must continue to adhere to the direction of this year's expenditure structure to focus on people's livelihood and social security, and increase residents' marginal propensity to consume.
With rural revitalization as the starting point, we will continue to promote the construction of rural infrastructure, promote industrial prosperity and prosperity, and implement tax and fee reduction policies for manufacturing industries.
This year, the Ministry of Finance continued to implement the systemic tax reduction policy, and at the same time, the phased tax and fee reduction policy was withdrawn in an orderly manner.
In 2020, we will introduce a phased tax and fee reduction policy in response to the epidemic, with classification adjustments and an orderly exit.
Extend the implementation period of policies such as the reduction of value-added tax for small-scale taxpayers in a timely manner to maintain the necessary support for economic recovery.
Temporary and emergency policies involving epidemic prevention, control, and guarantee supply will be suspended after expiration.
Wei Yan, deputy director of the Taxation Department of the Ministry of Finance, said that while implementing the inclusive tax and fee reduction policy for small and micro enterprises, the tax reduction and exemption for small and micro enterprises and individual industrial and commercial households will be further increased, and the manufacturing and technology will be increased. Innovate support and continue to clean up and standardize fee funds.
In the next step, we will implement the policy of fine-grained tax and fee reduction, focus on optimizing the implementation mechanism, and continue to exert policy effects, so that enterprises can have more sense of gain.
In terms of monetary policy, Sun Guofeng, Director of the Monetary Policy Department of the Central Bank, stated at a press conference of the State Council Information Office on the 13th that the People’s Bank of China will stick to the principle of stabilization, with me as the mainstay. In terms of total amount, the money supply and the scale of social financing will be maintained at the same nominal level. The economic growth rate is basically matched; structurally, it supports the green development of small and medium-sized enterprises and technological innovation; in terms of prices, it consolidates the results of the decline in the real interest rate of loans, and promotes a steady and moderate decline in the overall social financing cost.
Author: Zhu Yanran