Bloomberg:

You mentioned the income just now. My question is about the income growth. The real growth of income in the first half was 5.2% on a real average, also on a two-year average basis, which was slower than the economic growth. The Ministry of Commerce said last week in the five-year plan the retail sales will grow 5% a year through 2025. How can the economy rebalance and the dual circulations be successful, if the income and retail sales grow much slower than the overall economy? Thank you. 

Liu Aihua: 

Thank you for your question. Your question was mainly about income in the first half of the year. According to the statistics we just released, the nationwide per capita disposable income of residents in the first half of the year grew by 5.2%, almost the same as the average 5.3% two-year growth of GDP during the same period. Considering the impact of the pandemic, it was not easy to realize a per capita income growth of 5.2%. From the perspective of structure, there were three structural elements propelling the income growth rate to reach 5.2%.

First, with the continuous and steady recovery of the economy, the employment situation was generally stable, and growth of income from wages and salaries advanced swiftly. In the first half of the year, the income from wages and salaries grew by 12.1% year on year, with an average two-year growth of 7.2%.

Second, local governments have stepped up measures such as raising pension standards, improving basic living security for people in difficulties, and providing social relief and temporary assistance timely to meet people's living needs. Per capita net transfer income grew by 9%, with an average two-year growth of 8.6%.

Third, with the epidemic now under control, business activities gradually resumed. The statistics reflect the situation, with net business income growing by 17.5% year on year in the first half of the year and by 5.6% on a two-year average basis. The growth was attributed to the economic recovery, which propelled the increase of employment and income, policy support from local governments for ensuring people's living needs, and also endeavors from every economic entity. Based on the above-mentioned aspects, we consider these achievements remarkable as the income growth was generally in step with the economic growth. 

Judging from these aspects, the internal driving force of the Chinese economy is increasing and the vitality of market entities is also growing. We hold that income growth at the next phase will also have a solid basis to provide strong support for consumption.