CGTN | 07-Aug-2020 | By Global Business
The Chinese government’s ‘six priorities’ to help the country’s economy recover from the pandemic have been working well so far, said an investor on Tuesday, adding that investment opportunities remain positive in several sectors.
“With these measures to stabilize the economy, including the work on financing, employment, investment, international trade, currently the Chinese economy has become quite good,” said Chen Jiahe, chief investment officer at Novem Arcae Technologies. The “six priorities” being referred to were most recently re-emphasized by Chinese President Xi Jinping mid-July, aimed at ensuring stability in the six areas of employment, finance, foreign trade, foreign investment, domestic investment and market expectations.
Xi said China is committed to implementing those policies and measures for ensuring employment, people’s livelihoods, development of market entities, food and energy security, stable operation of industrial and supply chains, and smooth functioning at the community level. Chen said that the latest economic figures narrate a positive story for China. “In the second quarter, the GDP growth rate increased by 3.2 percent over a year ago, far better than the minus 6.8 percent reported in the first quarter,” Chen said.
“The latest CPI (consumer price index) growth rate in June was 2.5 percent, much lower than 4.5 percent reported at the end of 2019, which means amid fighting against coronavirus, China has also been able to stabilize the consumption market and brought the inflation figure down by two percent.”
“This is actually quite amazing if you think about how hard fighting the virus has been,” said Chen. Novem Arcae: Opportunities in property, blue chips. On Monday, China’s central bank outlined its plans for the second half of the year, and among other things, pledged to continue opening up its financial industry with a flexible and targeted monetary policy. Chen said the main concern over the economy currently is the service consumption sector, which is weak after the virus outbreak affected cinemas, restaurants, tourism industries.
“But it does very little harm to factories. However, consumption is also picking up back at a very fast speed. If you look at the data. You can see trends. China’s consumption decreased by 21 percent in February this year, but for June, the consumption only decreased by two percent from over a year ago. In the next few months, (we) actually expect this growth rate of consumption to turn back to positive,” he said.
In terms of the equities market, Chen said that the stock market in China has overall performed quite well in 2020, with the benchmark Shanghai and Shenzhen CSI 300 index increasing by over 16 percent, and the ChiNext growing by 60 percent year to date.
More fascinating tales from China: Visiting the ‘holy land’: Lhasa