China's April economic figures have been gradually released. Investments at high levels sped up and consumption continued to be vigorous. China's economy in general continued on its upward trend from the first quarter. However, year-on-year exports continued to drop sharply, becoming the biggest factor restricting China's current economy from bottoming out.

 

"China's economy is currently operating better than expected. The central government's economic stimulus package has produced noticeable effects and these positive changes must be strengthened with great efforts," Ma Jiantang, Commissioner of the National Bureau of Statistics of China, said recently.

 

Investment: the momentum of growth at high levels to continue

 

Statistics show that from January to April, urban fixed asset investments nationwide grew 30.5 percent year-on-year, up 1.9 percent compared with the first quarter. Calculating the continuously sliding consumer prices in the same period, the actual growth rate would be higher.

 

Investment has been a powerful force in fueling China's economic growth in recent years. It has had direct and rapid effects in driving economic growth, playing the leading role in "maintaining economic growth." The 4 trillion-yuan investment plans are increasingly producing positive effects.

 

The number of newly commenced projects is rapidly on the rise. Between January and April, the total investment in newly commenced projects nationwide reached 3.6797 trillion yuan, up 90.7 percent year-on-year. The growth rate is 3 percent higher than the first quarter and up by 95.8 percent from last year.

 

Consumption: maintaining vigorous to sustain further economic development

 

In April, the total retail sales of consumer goods in China increased by 14.8 percent year-on-year, 0.1 percent higher than March though there was a bigger price drop.

 

The current status of the auto and real estate markets, two major engines of the domestic market remains goods. In April, the production and sales of domestic vehicles both exceeded 1.15 million units, setting another record high. The real estate market improved slightly. In April, the national real estate climate index halted its 10-month-long month-on-month decline, rising slightly by 0.02 percentage points. From January to April, commercial building floor space sales nationwide increased by 17.5 percent compared with the same period last year and 9.3 percentage points higher than the first quarter.

 

In the same period, consumption growth in rural areas was nearly 3 percentage points higher than in urban areas. The long-lasting trend of urban consumption growth being faster than rural consumption is being reversed.

 

Zhang Liqun, research fellow with the Department of Macroeconomic Research of the Development Research Center of the State Council, believes that current relevantly rapid growth of domestic consumption indicates the abundant follow-up energy to fuel the Chinese economy.

 

Exports: sluggishness interspersed with positive change, standing at crossroad.

 

Boosted by the stimulus package, domestic demand, including investment and consumption, is continuously expanding, but it is difficult to predict when foreign demand, which has already plummeted, will recover. Weak foreign demand has become the largest factor hindering the Chinese economy's bottoming out.

 

Chinese exports dropped by 22.6 percent year-on-year in April, with the rate of decrease continuing to accelerate. According to an analysis based on workday averages done by the General Administration of Customs, exports increased by 6.9 percent in April compared with the export volume of the previous month, keeping the month-on-month upward trend since March.

 

The shrinkage of foreign demand is curbing the pace of China's economic recovery. Since export-oriented enterprises provide tens of millions of job opportunities in China, the continued operational difficulties of these enterprises will not only affect the production and investment of their upstream and downstream enterprises, but also cause decreases of both job opportunities and residents' incomes, and even likely hinder the future growth of consumption.

 

On the whole, Chinese economic operations have presently shown positive changes, but these changes are preliminary and need to be reinforced. The global economic situation is still very grim, and the Chinese economy is experiencing a hard time. –People’s Daily Online