What Does The Economic Growth Of 7% In 12Th Five-Year Mean?

Wen Jiabao, premier of the State Council, said on the 27 th visit to Xinhua network and the Chinese government network that the "12th Five-Year plan" determined that the speed of China's economic development was 7%. We should focus our efforts on improving the quality and efficiency of economic growth.

7%, it is the lower goal of the "Five Year Plan" in the past twenty years.

In the context of the steady growth of economic growth, why should we lower the target of GDP growth? In fact, this measure is more motivated by economic development in the medium and long term.

In line with the scientific development as the theme and accelerating the pformation of the economic development mode as the main line of the planning requirements, during the "12th Five-Year" period, China's economic structure will open a new strategic adjustment.

A series of China during the "12th Five-Year" period

In recent years, the actual growth rate of China's economy has obviously exceeded the planning speed. An important reason is the local government.

Recently, there are some noticeable new features in China's economic operation, such as resource constraints, labor shortage and inflation expectations.

An unavoidable question is whether China's potential economic growth will slow down after the per capita GDP reaches US $4000.

It is unlikely that China's economy will fall into the "middle income trap", but the future economic growth should not be blindly pursued too high.

From the perspective of aggregate demand, the 12th Five-Year plan suggests that China's trade balance should tend to be basically balanced, which means that the contribution of net exports will probably decrease.

From the perspective of supply, the supply of average annual new labour force in China will be reduced to zero in the next few years, and the "demographic dividend" supporting economic growth has been decreasing for a long time.

All these factors may drag down the potential of economic growth.

During the period of 12th Five-Year, the economic growth target was set at 7%. In the past years, the actual growth rate may be slightly higher than this goal.

If it reaches 8%-9%, it will be a suitable growth rate.

Accordingly, fiscal and monetary policies should remain neutral during the "12th Five-Year" period.

Much of the former financial capital is used for industrial construction and infrastructure, and in the future, it can be more used to promote employment and other public services.

The development of the service industry, especially the producer service industry, is expected to accelerate.

Strategic emerging industries will usher in considerable room for development.