The International Monetary Fund (IMF) has forecast China’s economic growth at 7.5 percent in 2014 and 7.3 percent next year, down from 7.7 percent last year.
The relative slowdown, according to IMF chief economist Olivier Blanchard, is a secondary product of China’s efforts to pursue more balanced growth, as well as a satisfying result.
China’s macro economy will inevitably come under downward pressure in 2014; however, the weak data also contains positive factors, bolstered by many achievements in economic structural optimization.
In industry, traditional industries such as steel and cement are experiencing an obvious fall, while high-tech industries show accelerating growth. The share of gross investment by service industry and private investment continues to rise.
Meanwhile, the endogenous growth of China’s economy has gradually recovered on the back of increasingly active small enterprises.
Moreover, employment is improving despite the economic downturn. Premier Li Keqiang said last year China needed 7.2 percent growth to keep unemployment stable, and growth of about 7 percent could guarantee a doubling of per capita gross domestic product by 2020 from the level in 2010.
It is natural for the economy to slow during a period of structural adjustment and optimization of industry. Furthermore, despite the slow pace, China’s economy is still on a higher level compared with other economies.
The official manufacturing purchasing managers’ index for March, compiled by the National Bureau of Statistics and the China Federation of Logistics and Purchasing, edged up 0.1 percentage points from February to 50.3. The reading, the first rise since November, signaled a positive message for the overall economy.
Moreover, it is expected China’s foreign trade could benefit from the European and U.S. recovery. The IMF said in its latest report the global economy strengthened at the end of 2013, and would improve this year and next year with a major impact from advanced economies.