View downward pressure on China's economy correctly

Have the right attitude towards pressure

We have to see the positive transformation in economic restructuring, despite some worries over the current slowdown.

It's only natural that the growth rate slows down when the economy enters long-term restructuring. The purpose for hitting the brakes on growth is to avoid hitting the bottom line and severely crippling the employment rate.

Government won't resort to short-term stimulus

China's first quarter GDP grows 7.4%

Since the global economic crisis, many people are worried about China's cooling economic growth; some people and institutions are even calling it a hard landing. At present, China's economy has stepped into a new phase when transformation is highly necessary to maintain a sound and sustainable development. It has to undergo a long-term adjustment before regaining momentum. Depending solely on monetary stimulus may backfire, and is not a smart way to maintain steady growth. Particularly, the country has to have a policy that stabilizes the real estate market. Although that will put negative pressures on the economy, it is needed for economic transformation.

Compared with a decline in China's exports, the international economy is projected to bounce back this year. The country did not quite focus on pushing forward its economic restructuring and reforms after the global economic crisis, thus losing some competitiveness in traditional products while hardly finding new ones in other areas, which is why exports now face a tough situation.

The new Chinese government is reforming the traditional ways to keep the momentum growing; the policies are focused on structural adjustments and reform acceleration. The measures have achieved positive results after being tested for one year. Therefore, we should not over-react to the economic slowdown. Although China's economy is operating at a low speed, it also has some positive signals:

First, quality and performance of economic growth are improving. In the first quarter of 2014, the growth of fiscal revenue that reflects macro activities is better than the same period last year; net profits from industrial enterprises that reflects micro results has also increased. Meanwhile, people's income growth has continued to rise.

Second, market vitality is increasing. The central government has been vigorously reforming the administration and business registration system since last year, which has effectively stimulated the market. Statistics show that newly established firms increased 32.1 percent year-on-year in the first quarter in Zhejiang province, with individual businesses rising 18.3 percent year-on-year; in Anhui province, the newly registered privately-owned firms increased 32.7 percent year-on-year; in Guangdong province, newly registered market players rose 27.9 percent year-on-year, and the privately-owned firms increased 50.5 percent.