(Economic Watch) GDP exceeds 110 trillion, can China's economy still be the "locomotive" of the world in 2022?

  China News Agency, Beijing, January 17th, Question: GDP exceeds 110 trillion, can China's economy still be the world's "locomotive" in 2022?

  China News Agency reporter Pang Wuji

  In 2021, China's economy will grow faster than expected, with a GDP exceeding 114 trillion yuan, a year-on-year increase of 8.1%.

In 2022, in the face of increasing downward pressure, can China continue to play the role of the "locomotive" of the world economy?

On the 17th, at the "2022 China Economic Situation Analysis Conference" hosted by the China News Agency, many experts believed that there are still five major supports for China's stable economic growth in 2022.

First, infrastructure investment is expected to accelerate significantly

  Yao Jingyuan, a special researcher at the Counselor's Office of the State Council and former chief economist of the National Bureau of Statistics, said here that demand contraction is one of the main sources of downward pressure on China's economy.

To expand domestic demand in 2022, in addition to unleashing consumption potential, another important area is investment.

  In 2021, China's fixed asset investment will increase by 4.9% year-on-year, of which infrastructure investment will only increase by 0.4%.

Yao Jingyuan believes that infrastructure, including high-speed rail, highways, river management, farmland water conservancy facilities, urban transportation construction and other fields, is an important source of growth in the past.

In the past, the growth rate of China's infrastructure investment could reach more than 20%, but last year, if the price factor was considered, the growth of infrastructure investment was negative.

  He believes that China will increase investment in infrastructure this year, and some major projects will be deployed ahead of schedule, which will drive demand from contraction to expansion and hedge against downward pressure on the economy.

  The signs are already showing.

Since the second half of last year, the pace of issuance of special bonds by local governments has accelerated, the investment in the central budget has accelerated, and 102 key projects identified in the "14th Five-Year Plan" have been launched one after another, and the "two new and one heavy" projects have been constructed in an orderly manner.

Second, new tax cuts and fee reductions may be launched

  Bai Jingming, a researcher and former vice president of the Chinese Academy of Fiscal Sciences, said at the forum that fiscal spending will remain strong this year.

Fiscal deficits and local special debts will remain on a certain scale, and policies will not take sharp turns.

In addition, a new tax and fee reduction policy will be implemented this year to reduce the burden on market players and stimulate the vitality of market players.

Third, there is a lot of room for autonomy in monetary policy

  Guan Tao, the global chief economist of Bank of China Securities, believes that this year, China's monetary policy will adhere to the principle of "stabilizing the word and focusing on me".

In addition to some institutional tools, such as: direct access to the real economy, support for small, medium and micro loans, regional development, green development, etc. will continue to be used, and if necessary this year, aggregate tools can also be used, such as: RRR cuts and interest rate cuts.

Compared with other major central banks, China is a minority of economies with normal monetary policy, so the normal monetary policy is China's "assets" rather than "liabilities".

  He believes that the further differentiation of monetary policies between China and the United States in 2022 will not hinder China's "me-based" monetary policy operations.

This time, in response to the outbreak of the epidemic, China's monetary policy is "first in, first out", and the mismatch of private currency has been greatly improved.

After the "8.11" exchange rate reform, the RMB exchange rate has improved and its flexibility has increased. Therefore, market players have greatly increased their adaptability and tolerance to the rise and fall of the RMB exchange rate, which also provides room for independent monetary policy.

Fourth, RCEP may become an important support for the steady growth of China's trade

  In 2021, China's foreign trade will perform strongly, with the total import and export volume exceeding the US$6 trillion mark for the first time.

Zhang Jianping, deputy director of the Academic Committee of the Research Institute of the Ministry of Commerce, said here that looking forward to 2022, China's foreign trade challenges and opportunities coexist.

  In terms of challenges, Zhang Jianping said that the current global epidemic is not over yet.

In addition, the high prices of raw materials for bulk commodities and the high international shipping costs, combined with the high foreign trade base in 2021, will put a lot of pressure on the operation of foreign trade in 2022.

  However, he said that the Regional Comprehensive Economic Partnership (RCEP) came into effect at the beginning of this year. This global super-large integrated market is bound to bring about huge effects of trade creation, investment increase and employment growth. It plays a very important supporting role in the steady growth of China's trade.

Fifth, the real estate market still has potential

  In the second half of 2021, China's real estate market will rapidly cool down, and the cumulative growth rate of investment, sales and other indicators will continue to shrink.

Is there still room for growth in real estate?

  Ni Pengfei, director of the Urban and Competitiveness Research Center of the Chinese Academy of Social Sciences, believes that the future structure optimization and quality improvement of real estate have great potential.

From a total point of view, the real estate scale may still grow.

Housing demand for some people moving into cities will continue to increase.

In addition, the quality will also improve. The per capita housing area in China has reached 40 square meters, but there is still a big gap in supporting facilities, environment and services, which need to be improved.

  In addition, in some hot spots, the rental housing needs of young people and new citizens will be gradually met and optimized.

In general, due to structural optimization and quality improvement, there is still potential for real estate in the future.