Economic Daily:

In the first three quarters, investment in manufacturing witnessed a 2.5% increase year-on-year, which shows the slowdown continued in general. Does that mean the real economy is facing some difficulties? Is there any room for future investment growth?

Mao shengyong:

Thanks for your question. It's a common concern. The development of investment in the first three quarters has the following characteristics. First, investment growth was generally stable. From January to September, the growth rate of fixed-asset investment (excluding rural households) reached 5.4%, or 0.1 percentage point slower than the rate from January to August, but unchanged from the same period of last year. As the investment scale is continuously expanding, the growth rate has faced a slowdown in recent years, but still remains generally stable. Second, the investment structure continued to be optimized. From January to September, investment in the tertiary industry grew at a fast rate of 7.2%. Meanwhile, investment in high-tech industries and social sectors grew at a rate of 13% or above, which is beneficial for us to shore up areas of weakness and make development more sustainable. Third, the growth rate of investment in manufacturing, including private investment, has slowed, which shows the real economy is currently facing some difficulties. We will intensify efforts to implement the central government's policies, further improve the business environment, strengthen the protection of intellectual property rights and advance financing support, so as to boost the real economy and development of private and medium- and small-sized enterprises.

For your second question, I believe there is great potential for future investment growth. In economics, consumption equals final demand, which needs supply; supply calls for investment, which is also called "derived demand". Thus, investment is linked to demand on one side, and to supply on the other. We cannot simply see investment as consumption, because it is not only an important variable of consumption, but also an important part of supply. For example, when we increase investment in infrastructure and public services, it concerns not only investment increase, but expansion of consumption and improvement of people's living standards. When a company expands investment in reproduction, it can increase supply capacity and improve the supply level. If enterprises increase investment in equipment renewal and technology transformation, it can improve the quality and level of the supply system, and drive technological progress. From this perspective, to increase effective investment can not only expand demand, but also improve the level and quality of supply, optimize the supply structure, promote technological progress and boost transformation and upgrading. Therefore, whether it is from the demand or supply perspective, there is great potential and large room for expansion of domestic investment.