NDRC Has No Appetite for New Stimulus Package

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　　China's top economic planner says it has no appetite to create any new stimulus¹ packages to shore up the economy.

 

　　CRI's Ding Lulu explains.

 

　　The National Development and Reform Commission is playing down the idea of new stimulus. It is meant to cool speculation² the government was considering sidelining its economic restructuring in the second-half of the year in favor of trying to revitalize growth.

 

　　The speculation has been growing, given that earlier this month, the central government reinstated a series of high-speed railway projects in the country's central and western regions.

 

　　The Chinese economy has slowed to a 7.5 percent growth in the second quarter, which is the lowest growth rate in over 20 years.

 

　　As such, the renewed railway projects, along with a renewed interest in urban construction, have led many to speculate the government is spearheading a new set of projects to boost growth.

 

　　However, Fan Jianping, the NDRC's chief economist³ told foreign journalists on Wednesday that not even a mini-version of a stimulus package should be expected for the rest of this year.

 

　　"The recent installation of key infrastructure⁵ projects should not be viewed as anything close to a stimulus. These projects were set as part of the 12th five-year plan and we are just carrying out as to what is already on the blueprint⁶."

 

　　Fan says the renewed expansion of railway construction has been timed to follow the dismantlement⁷ of the former Railway Ministry⁸, rather than to boost government investment.

 

　　There is already over 20-percent growth in fixed⁹ asset investment here in China.

 

　　Fan Jianping says this level of fixed-asset investment is aggressive enough.

 

　　He also contends the country's overall economic growth model is entering a new era, where growth within an 7 to 8 percent range will reign⁴ for a long time.

 

　　"We do not view the current economic slowdown as a crisis. We think the new growth range is decided¹⁰ by China's growth potential and will stay as the status quo of China's economic growth for the coming few years."

 

　　Fan also says China's growth potential is not on a decline because of outside factors, such as the financial crisis of 2008.

 

　　Instead, he contends the slowdown is the natural result of 3-decades of extremely-fast development.

 

　　He says the slowdown in the Chinese economy has actually created some benefits.

 

　　"The slowdown we saw in the first half of this year has many aspects worth commending. We have seen a much lower risk of inflation, and no risk of deflation. And at the same time, job creation has kept up with the demand. Therefore, we think the economy improved quality-wise."

 

　　While admitting those who reaped the rewards from 30-years of rapid development may not like the new approach of managing the economy, Fan Jianping says China's new leadership is prepared to get used to it.

 

　　For CRI, I'm Ding Lulu.

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