At China Macro-Economy Forum Mid-2012 on June 12 in Suzhou Industrial Park, the country’s decision-makers and the leading economists discussed macro-economic situations and future prospects.
In his keynote speech on stalled recovery and second stimulation, Professor Liu Yuanchun from School of Economics at Renmin University of China predicted that, in comparison with the previous year, Chinese GDP growth would drop by 0.6 percentage point to 8.6% and, after recovering from Q2-end bottom, Q4 growth would increase by 0.8 percentage point over Q1.
Due to multiple factors, Chinese economy continuously declined during the first six months this year, forcing the government to prioritize stable growth and resort to stimulation policies once again. The global economy is fluctuating, the housing market is still weak, and the country is facing more severe structural issues; as a result, Professor Liu saw many uncertainties during the process of recovery but predicted the GDP growth this year would “start low and end high”.
Deputy Director Yin Zhongqing of NPC Financial and Economic Affairs Committee talked about the growth potentials and pointed out that since 2007, the growth of Chinese GDP had shown two distinct features, the continuous slow-down and the frequent fluctuations. In a sense, “this indicates a W-pattern recovery”, he argued.
Yin agreed with using potential growth rate to guide new policies on maintaining steady economic growth, for declining growth potentials lead to the downshifting of benchmarks, which means the necessity to reconsider the macro-economic policies for another round of stimulation programs.