Economic Observer Online
Dec 8, 2011
By Sa Ni (飒妮)
Translated by Pang Lei
Original Article: [Chinese]
Leaders of China's ruling Communist Party will hold their annual policy-setting economic work conference from Dec. 12 to 14.
The Central Economic Work Conference is held every December in Beijing and participants - which include both the country's president and premier - will agree on the general direction for macroeconomic policy for the coming year, they also announce a set of policy goals at the end of the conference.
Discussions amongst high-level policymakers from central government departments, the military and provincial-level governments at this year's Central Economic Work Conference are likely to revolve around the theme of "stability."
At the economic work conference held at the end of 2010, policy makers vowed to pursue a macroeconomic policy orientation that was "proactive, stable, prudent and flexible" (“积极稳健、审慎灵活”). This year, in the face of uncertain economic prospects, both domestically and internationally, participants are likely to continue to emphasize the need for stability.
Analysts are not optimistic about the outlook for China's exports given the debt crisis in Europe and increasing trade friction. In October, China's exports grew 15.7 percent year-on-year, down from the 17.1 percent year-on-year growth registered in September.
An individual working for the international department of a listed Chinese bank told the EO, that there had been an obvious decline in the number of export orders from both Europe and America since October. In addition to a slow down in the rate of export growth, he said that he couldn't rule out the possibility of negative export growth in the first quarter of 2012.
Most economists are predicting that China's GDP growth rate will drop to below 9 percent in the final quarter of this year, after growing by more than 9 percent in each of the first 3 quarters of the year. Yesterday, China's Academy of Social Science (CASS) released their annual "Blue Book" on China's economy, in the report, economists from the state-backed think tank predicted that annual GDP growth for 2011 would come in at about 9.2 percent and that this rate would fall to around 8.9 percent in 2012.
Last week's release of two closely-watched Purchase Managers' Index (PMI) figures also gave credence to the likelihood of a slow down. The official PMI for November fell to 49.0, the first time that the index had fallen to below 50 since March 2009. The November figure for an alternate PMI calculated by HSBC registered 47.7, down 3.4 percentage points on October's figure to a 32-month low.
Links and Sources
The Economic Observer: Central Economic Work Conference: China to Stick With Current Fiscal and Monetary Policy Settings
//www.yunxiqiu.com/ens/2009/1208/157613.shtml
China Internet Information Center: Central Economic Work Conference 2010
http://www.china.org.cn/business/2010-12/10/content_21516462.htm