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Yu Miaojie: Signs are positive for China's GDP growth and exports


Over half of Chinese provinces and municipalities that have released GDP growth data for the first six months posted positive growth, especially a spike in growth in June, setting the tone for more robust growth of around 6 percent in the third quarter.

A total of 17 provinces and municipalities in China have released their own GDP growth data for the first half, of which 10 saw positive growth. Southwest China's Guizhou Province posted GDP growth of 1.5 percent year-on-year, while Northwest China's Ningxia Hui Autonomous Region and Central China's Hunan Province reported GDP growth of 1.3 percent.

Among the country's economic powerhouses, East China's Jiangsu Province reported GDP of about 4.67 trillion yuan ($668.3 billion) during the same period, growing 0.9 percent year-on-year. East China's Zhejiang Province posted GDP growth of 0.5 percent year-on-year to around 2.91 trillion yuan.

By contrast, South China's Guangdong Province saw its GDP growth down 2.5 percent year-on-year in the first half to about 4.92 trillion yuan. But this is within expectations as exports contribute to a large chunk of the province's GDP. From January to June, Guangdong's foreign trade of goods totaled 3.06 trillion yuan, down 7.1 percent year-on-year.

Guangdong's major economic indexes all improved in June, with fixed-asset investment hitting a new high since the beginning of 2020 to grow 11.6 percent year-on-year and the output growth of industries with annual revenue of 20 million yuan or more from their main business operations returning to expansion territory at 3.9 percent year-on-year.

The remarkable improvement prompted Chinese economists to offer optimistic projections for China's economy in the third quarter.

Yu Miaojie, deputy dean of the National School of Development at Peking University, told the Global Times that the optimistic prediction is that the country's GDP growth may reach 6 percent in the third quarter, if there are more supportive fiscal and monetary policies as well as continuous opening-up.

Yu said the signs are positive for the country's exports for the second half of this year, noting that it is likely to be flat compared with that of last year. 

"On one hand, overseas demand for Chinese products like clothes, shoes, smartphones and medical products will keep rising as the severe pandemic in some countries will limit their production. On the other, China's foreign trade with countries in Asia and along the Belt and Road Initiative may continue to rise thanks to free trade agreements like the Regional Comprehensive Economic Partnership," he said.

However, Cong Yi, a professor at Tianjin University of Finance and Economics, told the Global Times Tuesday that investment in new high-tech industries and 5G is expected to become the largest driver of China's economic engine this year, contributing to around 50 percent of GDP growth.

Shenzhen government said Tuesday that the city is boosting "new infrastructure" investment in sectors including artificial intelligence, big data and cloud computing to build up its growth momentum. The number of the city's first batch of new type of infrastructure projects is estimated to reach 95, with total investment at 411.9 billion yuan, according to the local government.


(From: Global Times, 21 Jul, 2020)