By Zhang Liqun, Department of Macroeconomic Research, Development Research Center of the State Council (DRC), and Gou Wenfeng, Chongqing Economic and Information Center

Report No 111, 2014 (Total No 4610)

Summary:

China's economic growth rate has been declining recently for the following reasons: the effects of the international financial crisis, a drop in exports, a lack of space in urban development because of the urbanization pattern, and increasing limits and costs in resources. The basic necessary conditions for stabilizing China's economic growth are: recovery of the global economy, stable export growth in China, urban agglomeration with a new urbanization type with more space for economic development, developmental transformation, and a decline in resource and environmental restraints.

Since there are still many reasons for problems in economic growth as well as in economic transformation and upgrading, the downward pressure on economic growth is still there and the possibility of systemic and regional economic risks can't be ignored. The government needs to both stabilize economic growth and transform and upgrade the economy, and develop new economic growth through a better developmental environment and improved economic structure with the ability to adapt to environmental change.