Reuters:

Given the economic data for the first 11 months of the year, is the annual economic growth target on track to be realized? What are the prospects for economic development in 2025? What measures can be taken to effectively expand domestic demand, particularly to boost consumption, and to cope with potential external shocks? Thank you.

Fu Linghui:

Thank you for your questions. The annual growth target is of great concern to all people. This year, the international environment has been complex and severe, with the global economic recovery slowing down, and domestic economic adjustments and transformations facing increasing difficulties. While the economy started off well in the first quarter, it faced growing pressures in the second and third quarters. Given the complex situation, the CPC Central Committee made scientific decisions and enhanced countercyclical adjustments. In particular, since the meeting of the Political Bureau of the CPC Central Committee on Sept. 26, a raft of incremental policies has been implemented at a rapid pace. As a result, major economic indicators have rebounded significantly since the beginning of the fourth quarter, effectively boosting confidence and leading to a noticeable increase in positive changes. Considering the overall performance this year, we are on track to achieve the major goals for economic and social development.

First, the economic recovery has continued. While several indicators experienced a modest slowdown in November due to short-term factors, the major economic indicators have shown a significant rebound since the fourth quarter compared to the level of the third quarter. The overall trend of economic recovery remains unchanged. According to the data from October and November, the growth rate of value added of industrial enterprises above designated size, the index of services production, and total retail sales of consumer goods increased by 0.4, 1.4 and 1.2 percentage points, respectively, compared to the third quarter. The manufacturing sector, as the mainstay of industry, witnessed a 6% growth in value-added in November, marking a 0.6 percentage point increase compared with the previous month. Within the service sector, the production indices for real estate and transport, storage and postal services surged by 2.1 and 1.3 percentage points, respectively, compared to the previous month. These positive developments are driving economic recovery.

Second, macroeconomic policies have provided a significant boost. In the fourth quarter, the combined effects of the raft of incremental policies and existing policies have synergistically expanded demand, driven production and propelled economic recovery. This is reflected in the significant rebound of major indicators in October, and this upward trend continued in November. Examining the data from November, it is evident that sales of household appliances, furniture and automobiles, supported by the consumer goods trade-in program, maintained rapid growth. With support from the policy for implementing major national strategies and building security capacity in key areas, and the program of large-scale equipment upgrades, both equipment and raw materials manufacturing witnessed accelerated growth. Investment in infrastructure, including water conservancy and power facilities, also increased rapidly. The ongoing positive effects of various policy measures will provide significant support for economic recovery and growth.

Third, new quality productive forces have shown steady growth. China's economy is in a critical period of transformation and upgrading. Various departments and localities have stepped up efforts to promote sci-tech innovation and industrial innovation, and foster and strengthen new quality productive forces, which has injected new vitality into the country's economic development. New industries such as integrated circuits manufacturing and new energy vehicles have maintained rapid growth, providing stronger support for economic growth. In November, the added value of the integrated circuits manufacturing industry grew by more than 20%, while the output of new energy vehicles surged by over 50%. Moreover, the digital and intelligent transformation of industries has promoted the development of emerging industries. In November, the intelligent unmanned aerial vehicles industry and smart onboard device industry both maintained double-digit growth.

Fourth, market expectations and confidence have continued to improve. With macroeconomic policies starting to yield results, a surge in market demand, and increased activity in the stock and property markets, market expectations and confidence are improving. This is driving a virtuous cycle of economic development. In November, sales of newly constructed residential properties increased in both volume and value. The transaction volume and turnover in the Shanghai and Shenzhen stock exchanges continued to climb substantially. Business sentiment has also improved. In November, the manufacturing PMI continued its upward trend for the third consecutive month, while the business activity index of the services sector maintained in the expansionary zone. Both the manufacturing and services sectors have shown upward trends in their business activity expectation indices. These positive developments have been conducive to expanding consumption and investment, driving economic recovery.

On the whole, despite facing many difficulties and challenges this year, the Chinese economy is underpinned by a stable foundation, multiple advantages, strong resilience and significant potential, while the supporting conditions and fundamental trends for long-term sound economic development have not changed. In response to the new situation and new problems, the CPC Central Committee made sound decisions in a timely manner, the incremental policies are gradually taking effect. The economy has shown clear signs of recovery, and we are on track to meet the main economic and social development goals for the year. For next year, the international environment will be increasingly volatile, grave and uncertain, the prevalence of trade protectionism will drag down the growth of global trade and the recovery of the world economy. The negative impact of geopolitical conflicts on the global supply of energy and other bulk commodities is still difficult to predict. The spillover effects of macroeconomic policy adjustments in major economies still face major uncertainties. The domestic economic adjustment and transformation keeps moving forward. We must continue to expand domestic demand, boost residents' employment and incomes, and make more efforts to defuse risks and potential dangers. In the face of the complex and severe situation both at home and abroad, the recent Central Economic Work Conference has made comprehensive deployments for next year, providing fundamental guidelines for the steady and long-term growth of the Chinese economy.

Next, we will thoroughly implement the guiding principles of the Central Economic Work Conference, promote sustained economic growth, and lay a solid foundation for the high-quality completion of the objectives and tasks outlined in the 14th Five-Year Plan (2021-2025). Thank you.