China Daily:

Recently, due to the complex international environment and the sporadic COVID-19 outbreaks in China, the country's economy is also facing greater pressure. What do you think about this? In addition, what were the characteristics of the economic performance in the first quarter? What's your comment on this? Thank you.

Fu Linghui:

Thanks for your questions. China's economy has attracted much attention, especially the economic performance in the first quarter. Since the beginning of this year, the international situation has become more complex and severe, and the country has seen multiple, sporadic COVID-19 outbreaks at home, which have made greater impact on economic performance. Faced with the complex situation, all localities and government departments have thoroughly implemented the decisions and plans of the CPC Central Committee and the State Council, insisted on seeking progress while maintaining stability, focused on stabilizing the macroeconomic market, and effectively responded to risks and challenges. The national economy continued to recover, and got off to a steady start. This was mainly reflected in the following aspects.

First, the main macro indicators remained within a reasonable range. From the perspective of growth, the economy continues to maintain a momentum of expansion. In the first quarter, the GDP increased 4.8% year on year, 0.8 percentage point higher than that in the fourth quarter of the previous year, and the month-on-month growth rate was 1.3%. In terms of employment, despite the impact of the pandemic, the country's surveyed unemployment rate in urban areas increased in March, but in general, the overall stable employment situation has not changed. In the first quarter, the national urban surveyed unemployment rate stood at 5.5%, basically the same as the first quarter of last year. In terms of commodity prices, the supply of goods and services in the market was generally sufficient, and consumer prices rose moderately. In the first quarter, consumer prices rose 1.1% year on year. In terms of the balance of payments, the trade surplus in goods expanded, the trade deficit in services narrowed, foreign exchange reserves remained stable at around $3.2 trillion, and the balance of payments remained stable.

Second, industrial and agricultural production was generally stable. Spring plowing and preparation for plowing were carried out in an orderly manner, and animal husbandry production grew steadily. The agricultural situation remained steady. In the first quarter, the added value of agriculture, forestry, animal husbandry, and fishery industries increased 6.1% year on year, the meat output including pork, beef, lamb and poultry increased 8.8%, and the industrial production grew rapidly. In the first quarter, the added value of industrial enterprises above designated size increased 6.5% year on year, among which the equipment manufacturing industry saw a year-on-year growth of 8.1%.

Third, the trend of innovative development continued. New industries continue to grow. In the first quarter, the added value of the high-tech manufacturing industry increased 14.2% year on year, and the added value of the information transmission, software, and information technology service industry increased 10.8%, both maintaining rapid growth. New business forms and models continued to grow strong. In the first quarter, the online retail sales of physical goods increased 8.8% year on year, maintaining growth from an already high number and accounting for 23.2% of the total retail sales of consumer goods.

Fourth, the economic structure has been adjusted and optimized. The proportion of the manufacturing industry continued to increase. In the first quarter, the added value of the manufacturing industry increased 6.1% year on year. It accounted for 28.9% of the GDP, 1.3 percentage points higher than the same period last year. The leading role of consumption is obvious. In the first quarter, the contribution rate of final consumption expenditure to economic growth was 69.4%, an increase of 18.7 percentage points over the same period last year and higher than the contribution rate of gross capital formation. The income ratio of urban and rural residents declined. In the first quarter, the per capita disposable income ratio of urban and rural residents was 2.39, down 0.04 from the same period of last year.

Fifth, green transformation kept steadily advancing. Green and low-carbon products grew rapidly. In the first quarter, the output of new energy vehicles and solar cells increased 140.8% and 24.3%, respectively. The proportion of clean energy consumption continued to rise. In the first quarter, the proportion of clean energy consumption, such as electricity generated by natural gas, water, nuclear, wind, and photovoltaics, increased 0.8 percentage point over the same period of the previous year. Energy consumption per unit of GDP continued to decline. In the first quarter, energy consumption per 10,000 yuan of GDP dropped 2.3% year on year.

Sixth, people's livelihood kept improving, and residents' income continued to grow. In the first quarter, the country's per capita disposable income increased 5.1% year on year in real terms. Specifically, the per capita disposable income of rural residents increased 6.3% in real terms, and the per capita disposable income of urban residents increased 4.2% in real terms. The income growth of rural residents continued to be faster than that of urban residents, and the basic living consumption of residents was guaranteed. In the first quarter, the added value of the consumer goods manufacturing industry increased 8.1% year on year, maintaining relatively rapid growth. The retail sales of commodities in grain, oil and food, and beverage commodities by enterprises above designated size increased 9.3% and 11.8%, respectively. Investment in the people's livelihood sector continued to increase. In the first quarter, investment in education and health increased 17.2% and 23.8%, respectively.

I want to point out that the global situation has become more complex since March. As the impact of the domestic epidemic continues, some unexpected factors have exceeded expectations. Some major indicators have seen slower increases, and the downward economic pressure has increased. However, the fundamentals of China's long-term positive economic growth have not changed, the continuous recovery of the economy has not changed, nor have the characteristics of great potential, sufficient resilience, and broad space in development. China is fully capable and well-placed to overcome difficulties and challenges and achieve sustainable and healthy economic development.

In the next stage, we will fully implement the spirit of the Central Economic Work Conference and the deployment of the government work report and scientifically coordinate epidemic prevention and control and economic and social development. We will make economic stability our top priority and seek progress while maintaining stability. We will put the steady growth in a more prominent position, intensify the execution of macro policies, pay close attention to the implementation of policies, and strive for early implementation and early results. We will effectively deal with prominent problems, stabilize the fundamentals of the economy, safeguard basic people's livelihood, keep the economy operating within a reasonable range, and continue to make new progress in promoting high-quality economic development.

Thank you.