China's GDP grew 9.2 percent in 2011, a
remarkable achievement outshining many other countries. However,
the current condition of the national economy is less than
appealing. The sequential quarterly GDP growth rates for 2011 stood
at 9.7 percent, 9.5 percent, 9.1 percent and 8.9 percent, showing a
trend of deceleration. A consensus has been made that stabilizing
growth should be the primary goal for China's economic
Judging by international and domestic
situations, it will be difficult to reach this goal.
First, the European debt crisis and the
deteriorating U.S. economy have taken their tolls on the Chinese
economy, and it is now still difficult to estimate the scale of
Second, the external environment for the
development of the real economy remains tough. A recent report by
the Development Research Center of the State Council pointed out
Chinese enterprises are stuck in the most difficult period since
the beginning of this century. Many companies are seriously short
of capital, which gives rise to many problems in their daily
operation and production.
Third, the Central Government is facing
enormous pressures in terms of policymaking. Although it has
managed to control the consumer prices at a relatively satisfactory
level, further pressure from rising prices is inevitable.
Fighting against inflation remains a problem
that needs constant attention, and the runaway prices might
restrict the government from making proactive economic stimulus
There are, however, a number of positive
factors. The decreasing economic growth rate has caught the
attention of the Central Government. In 2012, China will continue
its prudent monetary policy and adopt a proactive fiscal policy,
which will provide a much more relaxed environment for economic
growth. In the meantime, the downward trend of growth in 2011 is
interpreted as a soft landing brought about by the country's macro
economic readjustment. The fundamentals for long-term steady and
relatively fast economic development have not changed, laying a
sound foundation for the steady development of the national
In the next few years, urbanization,
industrialization and marketization will further improve, offering
great impetus for economic acceleration. Urbanization significantly
increases individual consumption. China is conducting industrial
restructuring, and the emerging industries are developing at a fast
speed, providing new momentum for the future economic development.
It is also striving to improve its marketization, in order to build
a more open, transparent and fair market economic system.
We firmly believe the Chinese economy will
maintain a sound and relatively fast growth, and make fresh
contributions to global economic recovery in 2012.