China’s economy is predicted to grow 7.3 percent in 2014, according to the Report on Economy of China: Analysis and Forecast (Fall 2014) released at the 2014 Fall Symposium on Analysis and Forecast of China’s Economy.

The symposium was organized by the Academic Division of Economics at the Chinese Academy of Social Sciences (CASS) on October 10 in Beijing.

Under dual pressure exerted by tighter domestic and resource restrictions and the unstable global economic recovery, a “new norm” for the Chinese economy has emerged in which growth rate trends toward the potential level, price hikes are moderate, and economic structuring is beginning to optimize, the report found.

Li Yang, vice president of CASS, noted that it is a one-sided view to attribute slowing growth to economic difficulties, saying China’s economy is entering a period of sustainable long-term development.

Forecast growth is down 0.1 percent from the 7.4 percent reported in spring 2014 largely because of deepening real estate market regulation, which has caused property investment, one-fourth of total investment, to fall significantly, explained Li Xuesong, deputy director of the Institute of Quantitative and Technical Economics at CASS.

Although the government has boosted investment in infrastructure, which accounts for one-fifth of total investment and is expected to grow by 20 percent during the year, financing constraints, inadequate project preparations and a low rate of return on investment are unlikely to offset the decline of property investment growth.

Given overall steady external demand and consumption, as well as high real estate inventory and restrictions on investment and financing for infrastructure, high-speed growth is hard to sustain in the long term and the rate of return on investment will continue to fall.

The report projected that China’s GDP growth will stand at approximately 7.0 percent in 2015, while exports and imports will rise by 4.9 percent and 3.2 percent respectively.

The Chinese version appeared in Chinese Social Sciences Today (CASS Issue), No. 268, October 17, 2014.

The Chinese link: http://cass.cssn.cn/yaowen/201410/t20141017_1366900.html

　　Translated by Chen Mirong

　　Revised by Tom Fearon