Authors: Jane Cai,Frank Tang
Posted on: South China Morning Post, March 12nd, 2017
China’s industrial output for the first two months of the year grew by “more than 6 per cent”, the statistics bureau chief said on Sunday in the latest signal that the Chinese economy was stabilising.
“The January-February industrial output rose above 6 per cent and that of the service sector jumped more than 8 per cent,” Ning Jizhe, who heads the National Bureau of Statistics, said on the sidelines of China’s annual “two sessions” key political gathering in Beijing.
Ning was speaking ahead of the official release of the figures. The statistics bureau is slated to release major economic data and the industrial production breakdown of the first two months of the year on Tuesday.
The figures for the industrial and service output that Ning revealed on Sunday are higher than last year’s 6 per cent and 7.8 per cent growth respectively.
A vast majority of industrial products saw an increase in production compared with the same period last year, the bureau chief added.
The quickened pace of growth, which suggests the economy is stabilising, will give Beijing more room to tackle its domestic problems and deal with potential external shocks.
In Premier Li Keqiang’s government work report delivered to the top legislature last week, Li said Beijing planned to set this year’s economic growth target at “around 6.5 per cent” and vowed for “higher [growth] if possible in practice”.
China has also pledged to implement a more proactive and effective fiscal policy this year, although monetary policy will be more prudent and neutral to prevent asset bubbles and financial risks.
Ning also said power generation rose 6.3 per cent year on year in the first two months, and freight volume was up 6.9 per cent. Railway cargo volume saw “double-digit growth”, he said.
And data released by the People’s Bank of China, the central bank, indicated that January-February new loans totalled 3.2 trillion yuan (HK$3.6 trillion), down 1.1 per cent from the same period last year.
Growth figures for power generation, railway cargo volume and new loans make up the three indicators in the “Li Keqiang index” to measure China’s economy.
The index was coined after Li, then Liaoning province’s party boss, said in 2007 that he considered the three figures better indicators of the economy than official GDP numbers.