Contents

Preface　the Macroeconomic Regulation and Control Policy Should Keep Pace with

　　the Times【Li Yang】／001

1　Analysis and Forecast of China’s Economic Situation (The Spring Report, 2015)

　　【Project Group】／001

2　Analysis of China’s Economic Trend in 2015-2020【Liu Shucheng】／021

Abstract: China’s economic development has entered a new normal, and an important characteristic among them is that economy growth rate from a high level to a medium-high-level. We should pay close attention to the attitude that treat new normal as decelerating of economy, because economy slow down will bring a series of serious problems to economic and social development in China. This paper analyses these issues and puts forward the countermeasures of preventing economy slow down, that is seeking the lasting driving force for economic growth. The implementation of the Silk Road Economic Belt and the 21st Century Maritime Silk Road, the coordinated development for Beijing-Tianjin-Hebei region, and the three national strategies of the Yangtze River Economic Belt, will be long lasting power to promote China’s economic growth. This paper points out that China’s economic growth is expected to decline bottomed out in 2015 and is expected to stop falling and moderate rebound from 2016 to 2020.

Keywords: New Normal; Medium-High-Level Growth Rate; Downward Pressure on the Economy

3　Analysis and Forecast of China’s Macroeconomic Fluctuations and Trends in 2015

　　【Kong Xianli, Gao Tiemei and Zhang Tongbin】／033

Abstract: This paper uses international synthetic index, general index and the early warning system of econometric methods to measure and predict the situation of China’s economic growth cycle in 2015. From September 2013, the economic growth of our country began a slow decline in a new round of short cycle, and by the early 2015, the economy continued to decline. Because of China’s economic downward pressure, the central bank should timely lower interest rates and the deposit reserve ratio to ease the financing difficulties and financing expensive problem, so that the social cost of financing is reduced. It is expected that the bottom of China’s economic cycle will appear in the first quarter of 2015, and from the beginning of the second quarter, the economy is expected to remain stable with a trend of slightly increase. China’s GDP growth rate in 2015 will reach around 7.2%, and the CPI growth rate will be about 2%. Economic growth and price fluctuation significantly slow down, and the government should take more active measures to keep the economy in good situation with medium speed growth rate and low inflation.

Keywords: Economic Growth Cycle; Cycle Index; Early Warning Signal System

4　Evaluation and Consideration of Agricultural Development in 2015【Li Zhou】／058

Abstract: In order to eliminate the weakness of agriculture and to accelerate the development of modern agriculture, we should increase the agricultural production based on reducing the input of chemical fertilizer and pesticides, increase the irrigation area based on reducing the total amount of agricultural water, and increase agriculture based on the improvement of total factor productivity contribution rate. To achieve this goal, we must deepen the reform of the rural land system, collective economy and rural governance, and replace the policy of avoiding risks to the policy of encouraging farmers to pursue benefit policy, turn the yellow box policy to the green box policy, replace the physical property policy to the value formed property policy, and change policies into laws and regulations.

Keywords: Agricultural Development; Modern Agriculture; Agriculture Reform

5　Analysis and Prospect of the Current Situation of Industrial Economy

　　【Yuan Lei, Jin Bei】／084

Abstract: At present, China’s industrial economic growth rate drops significantly, but the industrial structure adjustment makes positive progress, and the growth momentum gradually in balanced, which reflects a transition from the Old Normal to the New Normal. The industrial economy in the next stage is facing uncertain factors both at home and abroad, which bring some opportunities but also a greater challenge. In 2015, China’s industrial growth is facing greater difficulties than in 2014, the growth rate will be further downside, and it is expected that the annual industrial economic growth rate will remain at around 8%. In order to promote the smooth operation of the industrial economy, the government should focus on four aspects: firstly, expanding the area of investment and releasing the potential demand; secondly, applying foreign aid policy and alleviating difficulties of enterprises; thirdly, deepening the reform of the system and guiding the transformation and upgrading; fourthly, promoting the integration of development and optimizing industrial ecology.

Keywords: Industrial Economy; Industrial Structure; New Normal

6　Analysis and Prospect of China’s Service Industry in 2014 and 2015

　　【Xia Jiechang, Ni Hongfu】／112

Abstract: In 2014, the proportion of the scale and the added value of service industry continues to expand, investment in fixed assets rapid develops, the actual use of foreign investment fast grows, scale of trade in services is rapidly expanding, and the service industry becomes a new driving force for China’s economic growth in the New Normal. However, the overall level of China’s producer service industry is not high, the life service industry lack effective supply, the service trade is long-term deficit, and the talent shortage restricts the development of China’s service industry. In 2015, China’s service industry growth rate is expected to remain at around 7.8%, the proportion of the added value will further improve the service industry, fixed asset investment growth rate of service industry continues to be strong, the foreign direct investment in the service industry will continue to maintain more than 5%, and the scale growth rate of import and export services will maintain at 12%.

Keywords: Service Industry; Trade Scale; Economic Growth

7　Energy Situation Analysis and Policy Recommendation in 2015

　　【Li Ping, Liu Qiang and Dong Huimei】／124

Abstract: This report makes a retrospect on energy situation since 2014 as well as and some forecasting for 2015, focusing on some key issues such as world crude oil price, domestic demand structure changes. The conclusion is that demand peak of energy is coming and a slow negative growth can be foreseen, China should take advantage of this situation and promote the steps of energy structure adjustment, promote the revolution of energy production, consumption and technologies, as well as the market reform, targeting the transition to cleaner energy and marketization.

Keywords: Oil Price; Energy Market Reform; New and Renewable Energy; Distributed Energy

8　How To Achieve Our Country Residents’ Income Growth Target

　　【Zhang Chewei, Zhao Wen】／150

Abstract: Due to the residents’ income growth lags behind economic growth for a long time, under the condition of increasing economic downward pressure, how to achieve the goal that household income in 2010 doubles compared with that in 2020, which is also the goal of building a well-off society in an all-round way, has become a difficult task. Based on the analysis of relationship between economic growth and income growth, this paper depicts characteristics of residents’ income growth, discusses the main causes of residents’ income growth, and puts forward the suggestions on increasing the income of residents. This paper argues that problems in residents’ income growth are in the following aspects. Firstly, labor remuneration income which is the major part of residents’ income grows slowly. Secondly, residents’ property income accounts for minor part and increases slowly. Thirdly, the growth of low income is slow. Achieving the goal of double growth need to hold on to the bottom line of economic growth, improve labor remuneration income and the mechanism of reasonable wage growth, at the same time need to reform the capital market and open channels of capital gains into residents’ property income.

Keywords: Resident Income; Economic Growth; Labor Remuneration; Reverse Cycle

9　China’s Financial Situation and Monetary Policy in 2015

　　【Fei Zhaoqi, Peng Xingyun】／181

Abstract: China’s domestic economy has the following characteristics: firstly, China’s economy growth rate shifts from rapid to quick condition; secondly, deflation has shown, but bubble has not gone. Under this economic background, the money supply and monetary base growth is reduced, the credit growth and credit structure become more reasonable, year-on-year growth rate of social financing scale begin to fall, financial institutions deposit growth is reasonable, money market interest rate fluctuations in the second half of the year is declined obviously, the bond market index rises overall, bond issuance is expanded significantly, the stock market begin to return, foreign exchange reserve growth is reasonable. In terms of monetary policy operation, China creates new policies, such as the refinancing and the directional down policy. Looking ahead to 2015, macro policy will be more focused on the job market, monetary policy will be more focused on the long-term financial stability, guiding the interest rates and interest rate structure, China will actively promote the marketization reform of finance system.

Keywords: Monetary Policy; Financial Situation; Macro Policies; the Financial System

10　China Financial Situation Analysis and Prediction of 2015

　　【Chen Shoudong, Liu Yang】／212

Abstract: Through the infinite state of time-varying dynamic factor model, based on high dimensional index system of financial variables, this paper estimates the financial conditions index in our country. Results show that our country financial conditions index has been undertaking the impact of the financial crisis, and has passed the digestion phase of stimulus. Since 2011, under the steady monetary policy guidance, after the process of weak callback, the financial conditions have been in stabilized situation in late 2014. At the same time, along with the recovery of the world economy, the external impact of the financial condition which is not conducive to China is also gradually weakened. The first 10 months of the prediction results show that before the end of 2015, China’s financial conditions index is still in short-term shocks iterative process during the recovery.

Keywords: Financial Conditions Index; Periodic Characteristic; Prediction

11　China’s Foreign Trade is Facing Two-speed Growth in 2015

　　【Jin Baisong, Liu Jianying】／231

Abstract: The positive factors of the world economic recovery increase in 2015: the US economy recovers steadily and is rising; the EU economy resurges after experiencing a brief but tortuous period; the Japanese economy regains recovery after digesting the negative effects of raising the consumption tax; the economic recovery situation of India and ASEAN expand; Africa’s economic vitality reappears while its Ebola outbreak was under control; the benefits of falling commodity prices outweigh the risks, which is conducive to world economic growth; governments are adopting loose monetary policy to support their economies and so on, all of which contribute to China’s export expansion by creating a better environment. The growth rate of China’s export is expected to rise 8.0 percent in 2015.In contrast, downward pressure on China’s economy will continue to mount in 2015. China targeted economic growth of approximately 7 percent in 2015, according to Premier Li Keqiang’s government work report. The practice of proactive fiscal policy and the insurance of investment in fixed assets are impressive and boosting confidence, while the prediction for the growth rate of the total retail sales of consumer goods tend to be a bit rosier. Under the premise of the implementation of looser policy by the Chinese central bank, China’s import is expected to grow at the rate of 4.9 percent in 2015 by our mathematical models analysis.

Keywords: Quantitatively Easing; Trade; Belt and Road Initiatives

12　Trade Facilitation Reform: Empirical Analysis on Shanghai Free Trade Zone

　　【Pei Changhong, Chen Lifen】／269

Abstract: Trade facilitation reform is an important goal of Shanghai free trade zone construction tasks. Developed countries usually improve trade facilitation by the following method: the use of advanced information technology, establishing a “single window”, extensive customs cooperation, pay attention to risk management, simplify customs clearance procedures and optimizing the tax system. According to the evaluation of the scheme and facilitation standards, Shanghai free trade zone has some problems, such as coordinated regulation needing to improve efficiency, single window needing to be perfect, risk management consciousness needing to strengthen and the laws and regulations being not sound and so on. Thus, Shanghai free trade zone should perfect legal laws and regulations, implement fast customs clearance, promote “single window”, strengthen risk management, establish cooperation platform and enhance information measures.

Keywords: Trade Facilitation; Shanghai Free Trade Zone; Single Window