China reduces overcapacity to sustain stable economic growth

2018-08-17
CGTN

China remains committed to a stable and robust economy via deepening supply-side structural reform despite its fierce trade friction with the US, which mainly equals lowering barriers to production, particularly through tax cuts.

China’s economic planning arm, the National Development and Reform Commission (NDRC), claims the country has reached more than half of its annual goals in reducing coal and steel production to fight capacity gluts.

In the first seven months of 2018, coal production capacity in China descended by 80 million tons and steel by 24.7 million tons respectively, official data showed.

It is particularly gratifying that new tech industries continue to take off rapidly during the phase, and in the meantime, production of new energy vehicles and industrial robots has expanded by 68.6 percent and 21 percent respectively.

Spokesperson Zhao Chenxin for the NDRC noted, “It turns out that supply-side structural reform, for the time being, aligns well with the economic development pace of this nation. It is not only favorable for an array of practical issues to solve, let alone economic stability but serves as the country’s fundamental measure to attain high-quality growth.”

NPRC is also working on removing barriers to shore up the survival of enterprises. Some non-tax burdens have already been addressed.

“We will further clean up and standardize those irrational business service charges, and the burden of enterprises is projected to be alleviated by more than 150 billion yuan. Measures involving more than 120 billion yuan’s worth of burden have been carried out, approximately 80 percent of the goal,” said Zhang Manying, an official member from Department of Price Supervision of NDRC.

China settles on its supply-side structural reform as a way to keep the economy on firm footing in the second half of the year, aiming at avoiding potential financial risks incurred by the volatility of international trade policies.