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A delegate before the “Hall of the People” in Beijing: At the National People’s Congress, the guide is a more modest growth target of 6.5 percent per year
from the workshop of the world is to be a leading high-tech nation: the Beijing leadership agrees China on a hard phase of change a. Hundreds State companies that are highly indebted and no longer viable must be re-established
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Beijing – With a massive expansion of future technologies China wants to keep the domestic economy permanently in momentum. For the coming years, the government plans growth rates of at least 6.5 percent. But she agrees the country a on a hard transition. The conversion of the dominated by heavy industry world’s second largest economy to a high-tech giants will bring substantial changes.
“The development of our country is facing more and greater challenges,” warned Prime Minister Li Keqiang at the annual parliament meeting , “We must therefore prepare for a serious fight.”
In the past year the problems were revealed openly. Growth slowed to 6.9 percent, the lowest level since a quarter century. The demand at home and abroad weakened to investments spiked. There were also financial turmoil that caused uncertainty.All this through ‘to the global economy. Also German exporters obtain the slowdown in China clearly felt, which will continue in the current year, according to experts. Economists expect a further slowdown to 6.5 percent, while the government seeks a rate between 6.5 and seven percent.
Huge debts of state-alive gehaltenn Zombie Company
The old growth model has come to its limits. Conventional industries suffer from overcapacity and exacerbate pollution. Numerous alive artificially held by billionaire cash infusions SOEs have dramatically lost its competitiveness. At the same time, these so-called “zombie companies” have piled huge debts
This will change in the coming years. Inefficient parts of the manufacturing sector are restructured, the economy will be more based on services and high technology. Innovation is the driving force for the development of the country, Li said at the opening of the twelve-day People’s Congress.
According to his plans, the People’s Republic is a world leader are in the semiconductor industry, robotics industry, aircraft equipment and satellite technology. At the same time it is to promote the development of the Internet and ascend to the Cyber Power. The new five-year plan, the deputies should approve, provides for an increase in research spending to 2.5 percent of gross domestic product (GDP). In the period 2011-2015, the rate was still at 2.1 percent.
Beijing sets sights deficit of 3 percent of GDP at
However, it appears the leadership in Beijing trying not to let government spending get out of hand. Although it is aiming for this year a higher deficit of three percent of GDP to 2.3 percent in 2015. Many investors had hoped but to a higher setting.
The economist and former central bank advisor Yu Yongding therefore demanded an increase in the deficit threshold. Commerzbank economist Zhou Hao stressed contrast, China was restrained with high infrastructure investments in order to prevent a weakening of the own credit standing.
The government must create a difficult balancing act. Firstly, it wants to put growth on a healthier basis. Secondly, a hard landing for the economy is to be avoided, since otherwise threaten social unrest. The transformation is already difficult enough, Li wants the “zombie companies” to the collar. They are to be recovered or settled its viability through mergers.million jobs in state-owned companies at risk
Five to six million workers of state companies will probably lose in the next two to three years, their work, such as the recent two with the familiar process people said. Affected are mainly coal and steel industries. However, at the same time are in other industries tens of millions of new jobs arise, Li announced. The unemployment rate in cities is 2016 remain below 4.5 percent.
The problem of rampant pollution will tackle the communist leadership. For the first time the Commission set an upper limit on the energy consumption. There are also certain requirements in order to make the water more efficiently. Specific benchmarks for foreign trade are in the new plans but not named after such targets have been missed in recent years.
Jake Spring and Xiaoyi Shao, Reuters
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