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Institutions Predict That 2018 China's GDP Growth Will Be Around 6.7%
Jan 03, 2018

Institutions predict that 2018 China's GDP growth will be around 6.7%

At the beginning of the new year, many agencies predicted that China's economy will remain stable in 2018 with GDP growth rate at around 6.7% and China's economic growth in the steady-state range.

Chinese Academy of Social Sciences Institute of Industrial Economics recently released the fourth quarter of 2017, "Chinese economists hot research" results. According to the survey, economists predicted that the macroeconomic situation will stabilize. Economists judged the economic growth of 2017 to be 6.8% for the full year. In 2018, the Chinese economy will continue to maintain this growth rate. Meanwhile, the economies of the United States and India will accelerate their growth and the EU's economic growth will slow down.

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The Chinese Academy of Social Sciences 2018 China Economic Blue Book recently released by the Social Science Academy predicts that for the full year of 2017, China's GDP will increase by about 6.8%, an increase of 0.1 percentage point over the previous year and a GDP growth rate of 6.7% in 2018. In the meantime, the Shanghai Institute of Advanced Finance Institute also predicts China's real GDP growth will be about 6.7% for 2018.

However, a recent report released by the Institute of International Finance at Bank of China pointed out that in 2018 China's economy will grow by about 6.7%, but with steady growth, it will pay more attention to improving quality and efficiency. The National Institute of Development and Strategy of Renmin University of China also predicts that China's macro economy will maintain a relatively steady state of development by 2018 with a real GDP growth rate of 6.7%.

According to a survey conducted by the Academy of Social Sciences, economists' confidence in foreign trade growth has picked up in the future. Some 45% of economists think that the volume of exports in Q4 of 2017 will rise year-on-year, saying that the volume of exports will decline and remain unchanged year-on-year Of economists accounted for 18% and 27% respectively. 64% of economists think that in the fourth quarter, the social price level will rise year-on-year, and economists predict that social prices will start to release new upward momentum.

According to reports, in 2017, the global economy as a whole has been steadily recovering. In particular, the economic recovery in the developed countries such as the United States, Europe and Japan is better than expected, and the external demand for the Chinese economy has obviously improved. In the meantime, under the new economic normal, China hastened to readjust its economic structure, its economy continued to accumulate new momentum, its fiscal revenue was better than expected, its fiscal policy was more positive, its industrial production grew rapidly, its inventory level improved and industrial enterprises voluntarily replenished their stocks Demand plays a role, monetization of shantytowns and home buyers demand to promote real estate sales in third and fourth tier cities improved, and then led to consumer demand.

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On the other hand, from the supply side, China's labor supply has been declining year by year since it entered the inflection point in 2012. In recent years, the growth rate of total factor productivity has remained at a low level. The growth of capital stock also has been declining with the decline in the growth rate of fixed asset investment .

Zhu Baoliang, chief economist of the State Information Center, said although the supply-side structural reform has achieved some results, the problem of overcapacity in the traditional industries has not been fundamentally solved. In addition, the real estate problems are not resolved, the need to establish long-term mechanisms and countermeasures to solve. Then there is the issue of local government debt, the local government invisible debt or debt growth faster. At the same time, local governments borrow money through the financing platform of state-owned enterprises, and the problem is serious.

Some experts said that China's economy has shifted from a high-speed growth stage to a high-quality development stage and is now tackling the key issue of transforming its mode of development, optimizing its economic structure and shifting its growth momentum. However, we still have to see that there still exist structural contradictions in the economy and a long way to go in terms of structural adjustment and reform. The task of guarding against financial risks and deleveraging is still arduous. The current economy is getting better and better, to a certain extent, driven by the recovery of external demand and the replenishment of domestic stocks under the background of global economic recovery. However, the vitality of private investment is still insufficient. Some bottlenecks in short-board areas have not yet been broken, and the overall level of leverage remains high.