It is something of normalcy to have different opinions concerning the economic situation of China. It is normal for different interest groups to believe in opinions that suit their need the most. According to Anbound's chief researcher Chan Kung, it would be necessary for China to know the truth, 2019 will be the year for China to maintain 6% growth.
It is common in China that people demand statistics whenever there are judgments that they are not satisfied. This would be like proving the judgment is unreliable with statistics that is also unreliable. Chinese statistics are itself problematic, whether it is the interim or the final statistics. If the statistics can undoubtedly prove that the Chinese economic growth is already below 6%, everything would be too late. Therefore, the current judgment is very important, and the policy bet has no choice but to be placed on the judgment. If the judgment is correct, everything would be fine; if it is the reverse case, the CPC Publicity Department will have more meetings and discussions to do.
There are two hesitations that China should not have. The first hesitation is on maintaining the 6% growth. Some would question if 7% or even 6.5% is possible. They point out that in the external environment, there are always a lot of variables in economic growth, and all of these factors are likely to change. So, some think it is not impossible to maintain more than 6% growth. For these issues, the most important thing is to see that the U.S.-China trade war at the end of the year is actually an accelerator for production activities. If there is no U.S.-China trade war, the production would not be accelerated. If the U.S.-China trade war factor slows down in the future, then this is only a negative factor for future economic growth, instead of a favorable one. In addition, the U.S. factors in the external environment are gradually becoming problematic. The U.S. economic growth may also slow down, and even the crisis would lead to a slowdown in external demand, all of these points to a 6% economic growth rate.
The second hesitation that China should not have is the seriousness of maintaining the 6% growth. One problem that many people are thinking about is that even if it is only 6% of the economic growth rate, what can it do? Is the situation that serious? In fact, the situation of maintaining the 6% growth is really that serious for China. First of all, the gap in growth is too large. Compared with the previous economic growth rate, there is a big gap; such a large gap is not easy to make up, and it will expose various troubles and problems. Secondly, a large number of policies have to be halted halfway; the policy direction has to be changed again, and the cadre team will be at loss. This is an unavoidable problem, and it will take time to be resolved.
Therefore, China should not hesitate in the issue of maintaining 6% economic growth in 2019; there should be no more rhetoric and empty talks. If China hesitates, problems and troubles would become more prominent and urgent; even the non-problems would become problems by then while existing problems would become more serious. Economic activities are not the same as political activities; the relationship between economic and policies is more direct and clearer. The better for the economic activities, the more beneficial to the economic growth will be.
In an economy like China, the role of policy is very obvious; a policy would definitely show the results regardless if it is executed well or not.
Anbound's chief researcher Chan Kung once discussed concerning policy research; he pointed out that there is no policy science as this is a very operational field. Many skills are involved and while it is complicated and professionalized, it is not a "science"; those who say it is a science are mainly the academicians who try to make a living out of it. Chen Gong said that in any country, to execute well its policies, the main thing is to master four major factors.
The first factor is the experts in forecasting and judgments. The government departments' statistics and data are merely the "raw materials"; all depends on how these experts interpret them. Every country can have its own experts that it relies upon. Peter Navarro is one such expert who has caused many troubles to China. The second factor is policy reserves; a country has research reserves and long-term preparations; this is why some countries spend a lot in research institutes. The third factor is policy operation; even the best policy should be executed step by step; a wrong step could bring disastrous outcome. Finally, there should be someone explaining and translating the policies into actions. To maintain the 6% economic growth in 2019, China should utilize and mobilize these four policy factors to stabilize and increase its economy slightly.
From the perspective of the environment faced in 2019, it is really a major issue and challenge for China to focus on what the policy should focus on. Chan Kung once said that policies could not follow the public opinion; the policy department must be calm and have its own opinions and determination. This is the case with tax cuts; while there are much discussions on this in the public opinion; other than the finance and a few industries, the tax stimulating effect on the economy is not as huge as some might imagine. The policy department should really make efforts to understand the cost components of key sectors in the real economic environment. Anbound's chief researcher Chan Kung once provided a logical idea of the major goal to invigorate the private economy, promote investment and consumption, drive the stock market and the housing market, expand market space, and then utilize market space to promote reform, adjust the system, and thereby gradually realize the strategy of this major goal. The key is to conduct consortium economy; it is not difficult to organize private enterprises or strengthen self-management, tax cuts, credit management, markets, supply chains, policies, and even entrepreneurs' lifestyle solutions. It is not difficult to achieve all these; all it requires is a document from the Chinese central government.
Chan Kung also pointed out that basically he does not focus much on the U.S.-China trade war, as it is predictable. As long as the U.S. President Donald Trump handles the Russian problem well, there will be no major events. Instead, one should focus on the problem of China's economic growth; maintaining 6% growth will be of major significance.
