China to manage reasonable growth despite virus

By Chen Wenling Source:Global Times Published: 2020/2/18 19:58:40

Illustration: Luo Xuan/GT

China is unlikely to change its economic targets and aims keep growing within a reasonable range this year. The country's macro policy direction for the year is unlikely to change either, despite a potentially delayed national "two sessions" amid the fight against novel coronavirus pneumonia (COVID-19).

Specific numbers or ranges for the 2020 GDP growth target may not be put forward in the upcoming Government Work Report. Instead, the stated target may be to realize "a reasonable economic growth in terms of quantity" and to "keep the economy with a reasonable range," as noted in the official statement of the Central Economic Work Conference in December.

Currently, China is at a critical point in the fight against the virus outbreak and has explored the possibility of building a mechanism that can effectively control the increase of newly diagnosed cases while gradually restoring production and economic activities simultaneously. Therefore, the current chief priority for all authority levels is to seek the total containment of the epidemic so as to build a groundwork for an economic rebound.

The virus is a social and economic issue rather than just a public health one. It is only after the epidemic has been fully controlled that the economy can achieve its social and economic development targets for the year. At such a critical stage, officials at all levels are likely unable to break for the weeks it would take to hold the annual two sessions.

The epidemic has interrupted the normalcy of China's economic operations, but as the country has achieved interim progress in the optimization of its economic structure, its resilience is sufficient to endure this temporary hardship. The State-owned Assets Supervision and Administration Commission on Tuesday said the influence of the epidemic is temporary. Operational targets and reform goals for central state-owned enterprises will not change this year.

To meet its economic growth and reform goals, China will likely continue to fine-tune its existing "proactive" fiscal policy and "prudent" monetary policy to support growth and promote innovation and industry upgrading.

While continuing in the country's general policy direction, policymakers are expected to roll out more targeted support measures for the real economy, particularly for small and medium-sized enterprises which will bear the brunt of the blow.

In addition, more measures are expected to promote consumption, which accounts for an increasing proportion of overall economic growth.

The author is the chief economist at the China Center for International Economic Exchanges. She participated in drafting of the Government Work Report for several years.


blog comments powered by Disqus