[authoritative interview]
Guangming Daily reporter zhang yi
This year is a year of special importance in the process of China’s modernization, and it is also the first year of the 14 th Five-Year Plan. The Central Economic Work Conference, when deploying the key work in 2021, emphasized that it should adhere to the strategic base of expanding domestic demand. In the face of profound and complex changes in the development environment, how to get through the blocking points and fill the shortcomings, and form a higher level dynamic balance between demand traction supply and supply creation demand? How can consumption run out of the "acceleration" when expanding domestic demand? Wei Wang, director of the Institute of Market Economy of the State Council Development Research Center, was interviewed by reporters and made an authoritative interpretation.
The core requirement of expanding domestic demand and building a new development pattern
Reporter: This year is the first year of the 14 th Five-Year Plan. What kind of internal and external environment does China’s economic development face? What is the important role of adhering to the strategic basis of expanding domestic demand?
Wei Wang:In the face of the impact of the COVID-19 epidemic, China’s economy has shown strong resilience. In 2020, the gross domestic product (GDP) exceeded 100 billion yuan for the first time, an increase of 2.3% over the previous year. It is the only major economy in the world that maintains positive growth. At present, the factors supporting China’s economic growth are undergoing profound changes. On the one hand, due to the impact of the epidemic, the global economic recession is prominent and the trade friction is intensifying, which makes China’s economic development face severe external environmental challenges. On the other hand, the driving force of demand for economic growth is shifting from investment to consumption and innovation. In particular, China has a super-large-scale market advantage of 1.4 billion people, and strong domestic demand will become a solid foundation for promoting China’s sustained and stable economic growth.
The Central Economic Work Conference emphasized that adhering to the strategic basis of expanding domestic demand is the core requirement for building a new development pattern. Insisting on expanding domestic demand, accelerating the cultivation of new consumption, and further giving play to the basic role of consumption and the key role of investment are conducive to unblocking the domestic macro-cycle, alleviating risks and hedging external pressures, eliminating the risk aversion of enterprises, boosting development confidence, strengthening development resilience, expanding room for manoeuvre, improving self-adjustment ability, and realizing more full economies of scale, scope and network.
It is worth noting that at present, the expansion of China’s domestic demand and its promotion of economic growth are mainly driven by the continuous upgrading of consumption structure and consumption innovation promoted by new technologies, and there has been a new trend of upgrading and expanding, a new pattern of stratification and differentiation, and a series of new consumption that is different from the past has emerged, which has become a new kinetic energy and new growth point for promoting economic growth. Insisting on expanding domestic demand and promoting consumption in an all-round way is an important measure to conform to people’s yearning for a better life, which is conducive to making up for the shortcomings of high-end commodity consumption and education, housing, medical care and other services consumption, meeting people’s practical needs for better quality goods, better education, more comfortable living conditions, higher-level medical and health services, richer spiritual and cultural life, enhancing their sense of acquisition and happiness, and promoting people’s all-round development.
Innovation accelerates, and three positive factors promote consumption to accelerate recovery.
Reporter: According to the consumption data, the total retail sales of social consumer goods in 2020 was 39,198.1 billion yuan, down 3.9% from the previous year, and the decline was 3.3 percentage points narrower than that in the previous three quarters. How do you evaluate the situation of China’s consumer market in the past year?
Wei Wang:The outbreak of the COVID-19 epidemic in early 2020 has brought a huge impact on China’s consumption. The recovery of consumption is first suppressed and then promoted, and the rigidity of consumption is prominent, and the recovery of consumption is gradual. Compared with the investment demand, consumption is more obviously affected by the epidemic situation, and the final consumption expenditure in the whole year pulls down GDP by 0.5 percentage points. However, with the major strategic achievements in epidemic prevention and control, the consumer market has gradually recovered, consumer demand has been continuously released, and the pulling effect of consumption on economic growth has rebounded quarter by quarter.
Although the epidemic has had a huge impact on China’s consumer market, it has also forced consumption innovation to accelerate, and new products, services and models have emerged at an accelerated pace, forming new consumption hotspots, which not only effectively promotes consumption recovery, but also becomes a new driving force for China’s economic recovery and growth. Online consumption has accelerated in an all-round way, and the "home economy" has accelerated the development of new consumption patterns, and the penetration rate has increased significantly. In 2020, the national online retail sales increased by 10.9% over the previous year, and the growth rate was 1.2 percentage points faster than the previous three quarters. Service consumption has migrated to online, and "contactless" service innovation has accelerated. During the epidemic, a series of "non-contact" services such as online education, medical care, entertainment, audio-visual and so on have exploded, and traditional services such as catering are also accelerating "touching the net". "Live broadcast with goods" has become a new bright spot, and innovation in marketing methods has emerged rapidly. The driving role of new consumption is prominent, and domestic consumption is growing strongly; Healthy consumption has become a new bright spot in the consumer market; New changes have taken place in holiday consumption; The return of consumption brings important opportunities for the recovery of the consumer market and the upgrading and expansion.
Reporter: From 2014 to 2019, consumption has become the first driving force for China’s economic growth for six consecutive years. What is the consumption prospect this year?
Wei Wang:Looking forward to 2021, three positive factors will accelerate the recovery of consumption. First, the development environment at home and abroad is expected to continue to improve. China effectively controlled the large-scale spread of the epidemic, and the economy took the lead in getting out of the impact and impact of the epidemic. The global economy has stepped into recovery. International organizations such as IMF (International Monetary Fund), World Bank, and OECD have recently lowered their global economic growth forecasts to 5.2%, 4%, and 4.2% next year, but they are still significantly higher than in 2020 (9.5, 5.9, and 8.4 percentage points higher, respectively). Secondly, the overall balance of supply and demand in the domestic market. The IMF predicts that the year-on-year growth rate of world CPI will be 3.4% and that of China will be 2.7% in 2021. While the global supply and demand pressure is rising, the supply and demand in China market will be relatively more stable. With the continuous improvement of the epidemic prevention and control mechanism and the improvement of the consumption environment, residents’ adaptability to getting along with the epidemic for a long time has been enhanced, and consumer confidence and willingness will rise steadily, which is conducive to the continuous improvement of market demand. Finally, the government insists on stabilizing employment and market players as priority areas for policy support, and the actual growth rate of residents’ income is expected to return to the growth track.
Generally speaking, with the expected improvement of global economic growth and the stable market environment, China’s macro-economy will continue to rebound steadily and the economic cycle will be smoother. On the basis of the low base in 2020, the total retail sales of social consumer goods is expected to increase by about 4%-5% in 2021, and the role of consumption in driving economic growth will be further strengthened.
Focus on breakthroughs to make the advantages of ultra-large-scale markets stronger.
Reporter: What do you think are the main "blocking points" and "pain points" for expanding domestic demand at present? How to smooth? How to further develop the advantages of China’s super-large market scale?
Wei Wang:Objectively speaking, although China has a super-large-scale market advantage, it is still not strong enough, and there is still some fragility. The release of consumption potential and the development of new consumption still face many institutional constraints, and the effective and high-end supply still lags behind. There are many shortcomings and weak links in infrastructure construction such as transportation, water conservancy, energy, public health, ecological environment protection, agriculture and rural areas, disaster prevention and mitigation, etc. The pace of accelerating institutional opening to the international advanced standards and improving the internationalization level of China’s market still needs to be accelerated and legalized.
In 2021, on the basis of adhering to the strategic basis of expanding domestic demand, economic work should organically combine comprehensively promoting consumption and enhancing investment stamina with deepening supply-side structural reform, pay attention to demand-side management, make effective institutional arrangements in rationally guiding consumption, savings and investment, open up blocking points, fill shortcomings, smooth the national economic cycle, accelerate the improvement of supply quality and improve the infrastructure conducive to the release of domestic demand, and promote the supply of goods and services from the low-end to the high-end, which is the "14 th Five-Year Plan"
The most fundamental thing to expand consumption is to promote employment and raise the real income level. On the basis of "six guarantees" and "six stabilities", we should improve the vocational and technical education system to achieve more full and higher quality employment and improve the income level of a wider class; At the same time, by speeding up the improvement of social security and the additional deduction policy for personal income tax, we will further optimize the income distribution structure, reduce the burden on households, stabilize middle-income groups and improve the ability to pay for consumption, thus laying a stable market foundation for expanding consumption.
It is necessary to speed up the improvement of supply quality, accelerate the cultivation of high-end brands in food, cosmetics, clothing, consumer electronics and other fields, and promote the supply of goods from low-end to high-end; Promote the transformation and upgrading of the consumer industry structure, especially the accelerated development of various life service industries such as catering, accommodation, tourism and travel; Accelerate the development of various new technologies, new products, new services, new formats and new models, and further improve the development level of the digital economy in the consumer sector. Reasonably increase public consumption and improve the efficiency of public service expenditures such as education, medical care, old-age care and child care. Further relax access restrictions in the fields of education, medical care and old-age care, and support social forces to increase effective supply.
It is necessary to take the construction of modern circulation system as the breakthrough point, and accelerate the formation of a large domestic market with convergence of supply and demand, integration of urban and rural areas, and connectivity of domestic and foreign trade. Accelerate the sinking of the domestic demand market, further promote the construction of an efficient circulation system in urban and rural areas, expand the coverage of e-commerce in rural areas, promote the two-way circulation of industrial products to the countryside and agricultural products to the city, and fully tap the consumption potential of counties and towns. Accelerate the development of new international consumption formats such as cross-border e-commerce and duty-free shops in the city, and accelerate the integrated development of domestic and foreign trade.
Guangming Daily (January 25, 2021, 04 edition)
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