Contents

Lead the New Normal, Create New Glory (Preface)【Li Yang】／001

Ⅰ　General Report

1　Analyses and Forecasts on China’s Economy

　　—The Fall Report in 2015【Project Group】／001

　　1.The Current International Economic Situation and China Economic Forecast

　　　in 2015-2016／003

　　2.Intensify the Implement of the Proactive Fiscal Policy，Focus on A Steady Growth

　　　and on Trying to Increase Efficiency in its Active Fiscal Policy，Actively Expand

　　　the Domestic Demand／010

　　3. Implement the Monetary Policy of Loose Structure，Improve the Financial Reform，

　　　which will be Helpful for the Real Economy and Structure Adjustment，Prevention

　　　the Systemic Financial Risk／016

2　Summary of the Fall Forum of Analyses and Forecasts on China’s Economy in 2015

　　【Peng Zhan】／022

Ⅱ　Economic Growth and Industry Development

3　Prospects for the Trend in China’s Economic Fluctuation During “the 13th Five-Year Plan”

　　Period【Liu Shucheng】／028

Abstract：First of all, this paper analyses the situation of China’s macroeconomic fluctuations during the first year of “the 13th Five-Year Plan”.Based on this analysis, the paper foresees that there will be four possibilities for China’s macroeconomic trends in “the 13th Five-Year Plan” Period: long-lasting deceleration of the economic growth rate, long-lasting stagnation of the economic growth rate, rapid acceleration of the economic growth rate, and following the normalization of economic fluctuation, a reasonably normal fluctuation of economic growth. This paper explains that the New Normal does not imply a slowdown of the economy, and it illustrates that the macroeconomic control policies to continue with “the weak stimulus” and “hold to the lower limit” will be more and more passive. As foreseen in this paper, the proposals for “the 13th Five-Year Plan” by the Central Committee of the Party in 2015, and its implementation at the beginning of 2016, will be part of China’s economic development under the New Normal circumstances; they will be an important strategic deployment of China’s economic development in the future, and they will form a long-lasting power for the promotion of China’s economic growth. In this way, China’s economic growth is expected to avoid a bottom-out in 2015 and is expected to enter a new cycle of rising growth during the New Normal of “the 13th Five-Year Plan” Period.

Keywords: The 13th Five-Year Plan; Macroeconomy; Economic Fluctuations; New Normal

4　The Economic Growth Rate Reaches the Bottom but will be Stable Next Year

　　—Analysis and Forecast on Economy in 2015-2016【Zhang Liqun】／039

Abstract: In 2015, China’s industrial growth has been slow to stabilize, consumption continues to grow steadily, and real estate sales continue to pick up. Despite the fact that investment in infrastructure has grown with fluctuation, there is still a strong investment willingness. Besides, the efforts to get rid of overcapacity are increasing, and the stock market risk is under control. Under the complicated domestic and international situation, the correction of China’s economic growth will continue and is expected to reach its lowest point. It is predicted that the export growth rate will be at around 5%, the investment growth rate will be around 11%, and the real consumption growth rate will be 10.5% in 2016. China’s economy is expected to achieve a smooth recovery during the 13th Five-Year Plan. The government should connect stable growth with economic transformation. At the same time, the government should accelerate the development and consolidation of economic growth in the New Normal by continuously improving environmental development, economic structure, and the microfoundation of environmental adaption.

Keywords: Economic Growth；New Normal；Economic Transformation

5　The Forecast for National Economic Development in 2015【Zhao Kun, Wang Baolin】／046

Abstract: In 2015, the world economic recovery has been weaker than expected, and the turmoils within the international financial market have intensified. China’s economic structure and development mode are undergoing profound adjustments, the economic downward pressure is increasing, and the economy faces more difficulties and challenges. Facing the complicated domestic and international environment for economic development, the Central Government is supporting stable growth, is proposing accurate regulation and control, and is focusing on stabilizing the economic growth, structural adjustment, and deepening reforms in crucial areas. Besides, the Government is guarding against and defusing potential risks, strengthening and improving the livelihood of the people, and making economic and social development generally stable. At the beginning of the 13th Five-Year Plan in 2016, China will still have a lot of room for development, and the economic fundamentals will not have changed. With the policy of steady growth, promoting reform, structural adjustment, improving people’s livelihood, and anti-risk measures, China’s economic development will still have good support.

Keywords: National Economy；Development Forecast；Macroeconomic Regulation and Control

6　Situation Analysis and Policy Suggestion for the Industrial Economy【Yuan Lei, Jin Bei】／054

Abstract: In the first three quarters of 2015, the industrial growth faced great downside pressure, and the growth rate fell to the lowest level since the reform and the opening up. However, the adjustment of industrial structure had made positive progress, and the quality of industrial growth had improved. The decline of the potential output growth rate is the fundamental reason for the downturn of the industrial economy. In the coming period, the change in China’s potential output growth rate will depend on the development and adjustment of the economy itself, and it will also depend on the speed, breadth and depth of the economic restructuring and the reform of the institutional mechanisms. The annual industrial output growth in 2015 and 2016 is expected to reach around 5.8% and 5.5% respectively. The forecasts for the growth of the added-value of Enterprises above Designated Size in 2015 and 2016 are 6% and 5.7% respectively. In the current context, the government should reduce the forecast for industrial economic growth, avoid the introduction of large-scale economic stimulus policies, accelerate the reform of the system and mechanisms to promote the adjustment of industrial economic structure, and give full play to the role of the market mechanism to promote industrial enterprise innovation.

Keywords: Industrial Economy; Potential Output Growth; Industrial Economic Growth

7　Forecasts for Industry Growth and Industrial Enterprises Prosperity Index Analysis in 2015

　　【Xie Sanming】／075

Abstract: In 2015, the industrial production growth rate has fallen; PPI, PMI and other indicators show that the industrial economic downward pressure has increased; due to the sluggish performance in the world’s major economies, global industrial product exports have continued to decline; current investments have continued to fall, but the rate of decline in industrial profits has slowed down. With consumption as the main force driving economic growth, the product output in the automobile industry and other industrial sectors appears to change, and the sales in the real estate market appear to have signs of recovery, driving investments towards stabilization with a sign of bottoming-out. The industrial economic synthetic index shows that the industrial operation is still adjusting onto a low level and an economic downward pressure exists; on the early warning index, industrial added value growth, investment growth, power consumption growth, enterprise benefit growth, as well as the price index, are in the “over cold” range. In the future, to keep sustainable industrial growth sustainable, we should enhance the strength of governmental supervision, establish a fair and open market environment, and strive to deal with the relationship between the structural adjustment and the upgrading of traditional industries ; moreover, we must also promote the positive role of financial management in stabilizing industrial growth.

Keywords: Industrial Growth；Industrial Prosperity Index; Warning Index

Ⅲ　Macro-economy Policy and Macro-economic Regulation and Contro

l8　China’s Macroeconomic Situation and Policies in 2016【Zhu Baoliang】／094

Abstract: In 2015, China’s economy is maintaining a steady development, new growth momentum is gradually taking shape, and the vitality of the main body of microeconomics has been released. However, the structural problems in the economic operation still stand out. The contradictions in industrial structure have become critical, the real estate market is still in an adjustment period, the financing capacity of local governments has declined, and enterprises face numerous operational difficulties. Meanwhile, the large restructuring of the global economic and political landscape will also affect China’s economic development. However, China is still in a condition to maintain high-speed growth. The growth of the GDP in 2016 is expected to be around 6.5%, and the actual economic growth rate is slightly lower than the potential growth rate of about 7%. To overcome the current economic difficulties, the government should make its priority to adjust the economic structure, taking into account economic growth and prevention of financial risks, and focus on the balance of “steady growth, structural adjustment, anti-risk”.

Keywords: Macroeconomic; Low Inflation; Policies

9　Policy Choice of China’s Economic Development in 2016【Li Boxi】／108

Abstract: The year 2016 is the starting year of the “ Thirteenth Five-Year Plan” period, designed to comprehensively promote reform and the opening up and to implement the top-level design of the country. As for the growth of China’s economic development, the growth of the GDP in the 6.0%-7.5% range is relatively reasonable, and would render the development good both in quality and in efficiency. As for the new driving factors of economic development, China should persist in implementing a strategy based on innovation . In terms of the New Normal planning in China, the “ Thirteenth Five-Year Plan” should play a guiding role. As for improvements in investments, the main targets should be diversification of the subjects of investment, the marketization of investment decisions and the improvement of the investment structure . In the development of China’s real economy, the development of new industries and high-tech industries should be underlined. The innovation in China’s economic macro-control will be reflected in some aspects such as implementing the active financial policy and steady monetary policy.

Keywords: “Thirteenth Five-Year Plan” Period; Economic Development; Policy Choices

10　China’s Macroeconomic Situation and Policies: 2015-2016

　　【Institute of Economic Research, Renmin University of China】／116

Abstract: In 2015, China’s economy preliminarily interrupted the growth deceleration trend since 2011, but its recovery process stagnated and has brought about a new trough in the economic cycle . In 2016, China’s economy should still adopt a proactive fiscal policy and prudent monetary policies. Through the counter-cycle operation of accommodative demand management, China’s economic expansion would be resumed and sustained, and effectively promote the normalization of its comprehensive economic condition, so as to achieve the final transition of the business cycle from depression to prosperity.

Keywords: China’s Economy; Growth, Fluctuation and Inflation; Demand Management

11　The Analysis and Forecasting of the Economic Situations during the Period 2015-2016

　　【Chen Lei, Sui Zhanlin and Meng Yonggang】／127

Abstract: The economic climate has stopped its downward trend since the second quarter of 2015 and is expected to keep roughly stable in the “partial cold” range. Influenced by the policy of keeping the growth of the economy stable, it is unlikely to change to a downwards-oriented trend and step into the “cold” state in a short time. We predict that the GDP growth rate in 2015 and 2016 will reach about 6.9% and 6.8% respectively, and meanwhile the annual inflation rate should be about 1.5% and 1.9% respectively. The cycles of economics and inflation should also be viewed as a wavelet in the “New Normal” stage.

Keywords: Business Cycle; Economic Situations; Monitoring and Early Warning; Forecasting

Ⅳ　Analysis of Consumption, Investment and Trade Situation

12　Consumption-driven Economy and Cost Reduction: Two Starting Points to Promote

　　Economic Development【Cai Jin, Wu Wei】／150

Abstract: China’s current economic growth is slowing down and tends to be stable, and the same is true for the manufacturing industry. The non-manufacturing industry maintains fairly rapid growth, and the market sizes of the logistics and production industries are growing stably. Employment activity remains stable. The market prices show signs of stabilization at a low level. Meanwhile, the economic structure has also been optimized, the most significant feature of which is that consumption has become the driving force of economic growth. And the income distribution reform might promote an increase in consumption. In addition, the improvement of economic efficiency is the primary problem that needs to be solved in the current economic development. Regarding “expenditure reduction”, the only way to improve quality and efficiency is by transforming the development mode and reducing costs.

Keywords: Economic Development；Consumption-driven Economy；Cost Reduction

13　Monetary and Financial Operations under the Strategy of Steady Growth and Risk Prevention

　　【Yan Xiandong, Hu Xinjie】／160

Abstract: In 2015, China’s economic development presents slowdown trends, and its economy faces downward pressure. Through speeding up reform of interest rate marketization, perfecting the middle price mechanism and deposit insurance system, speeding up the opening of capital account, reforming the financial institutions and deposit reserve appraisal system, the Central Bank of China is implementing a series of measures to stabilize economic conditions. In 2015, an overall steady financial operation and further optimized financial structures are present in China, which are reflected in some aspects such as a gradual recovery in the growth of the money supply, a drop of growth in the total stock of social financing compared with the previous year, an increase in the size of loans, a fall-after-rise trend in the market interest rates. However, China’s financial system still faces many issues such as an increase in financial risks and the local debt risk, a weakened demand for credit, and downward financial profitability. Looking forward to 2016, our country will create a good financial environment for economic stability, and increase its liquidity on the market.

Keywords: Financial Operations; Financial Risk; Financial Policy

14　Analysis and Forecast of China’s Economy and Investment Situation in 2016【Zhang Hanya】／176

Abstract: In 2015, the condition of investments in China presented a downward trend in the first three quarters while it presented an upward trend in the fourth quarter, and the full-year growth rate is expected to remain steady at around 7%. There are some favorable factors for the growth of investments in 2016, such as: a good historical period, the government’s determination, the “ Thirteenth Five-Year Plan” and good policies. However, at the same time, there are also the following disadvantages: a lack of attractive aspects for investments to be made in the manufacturing sector, an absence of construction funds, a soft housing market, and some enterprises and local governments are not doing their duties. The forecast for 2016 is: China’s investment growth rate will be higher than 11%, its consumption growth rate will be higher than that of 2015, China’s economic growth rate will remain at around 7%. Therefore, fiscal and monetary policies, encouraging innovation policies and measures, etc. should be proposed.

Keywords: Economic Development; Investment Growth

15　Two-speed Drop in China’s Foreign Trade

　　—Analysis and Forecast on Foreign Trade in 2015-2016【Jin Baisong, Liu Jianying】／184

Abstract: On the 2015 international market, the dollar appreciates sharply, and the commodity prices decline simultaneously, resulting in the bizarre downward trend of world economy and trade. In recent years, the growth rate of China’s foreign trade has always been running low, and has even “ dived below the surface” during the year 2015, which has puzzled many people. It can be surmised that China’s foreign trade is in fact fluctuating in a reasonable range and in a normal orbit. The growth rate of China’s foreign trade shows a rare decrease in both exports (a decrease of 3.5%) and imports (a decrease of 16.5%), which is just a superficial phenomenon. There is more and more probability of a decline in the world economy in 2016, while China’s foreign trade is expected to dive downward. It is suggested that the government should implement a proactive reform policy and the central bank should implement a loose monetary policy. Since China possesses ample time to set policies, it should deal calmly and give priority to lifting the financial restrictions on private enterprises. If a new recession in the world’s economy occurs in 2016, China’s foreign trade will drop substantially; if it is weak, dollar-denominated exports will decline slightly and imports will decrease moderately.

Keywords: Two-speed Drop；Appreciation of the USD；Decline in Commodity Prices；Decline in the World’s Economy

Ⅴ　Market Price and Income Distribution

16　Analysis and Forecast for China’s Employment Situation during the Years 2015-2016

　　【Yang Yiyong, Huang Yandong】／211

Abstract: In 2015, China’s employment situation has been generally stable. The unemployment rate has remained at a low level, the number of new urban jobs has grown steadily, the supply and demand on the human resources market is nearly balanced, and rural labor employment has steadily increased. However, employment in China also faces some problems. The participation rate of the labor force has continued to decline, wages have increased slowly, the recruitment intentions of enterprises are declining, and the structural employment problem is becoming more and more obvious. To ensure that the employment situation in 2016 will not deteriorate further, the government needs to improve public pioneering work, to strictly monitor and manage the wage offenses committed by enterprises so as to narrow the income gap among workers, to strengthen targeted vocational training in order to eliminate structural unemployment, and to regulate the labor relations to promote decent work for workers at the bottom of the ladder.

Keywords: Employment Situation; Unemployment Rate; Pioneering Work; Supply and Demand Gap

17　Analysis and Forecast for China’s Tax Situation in 2015【Fu Guangjun】／223

Abstract: The first quarter of China’s tax revenue shows a significant low-speed running trend in 2015, a year for which the growth rate is much lower than the economic growth rate of 3.5 percent; the cumulative growth rate in the second quarter is 4.7%, but still below the economic growth rate of 2.2 percent; the cumulative growth rate in the third quarter is 5.5%, which narrows the gap of the economic growth rate of 1.4 percent. Some of the main categories of taxes on income growth over the previous year rise and some of them fall. The growth rate of the principle sources of tax revenue in the coastal province has picked up, and the growth rate of most provinces over the previous year has slowed down, which directly affects the growth rate of the national tax revenue which shows a downward trend. In 2015, if China’s macroeconomic situation is still in the New Normal, the tax revenue will also enter a period of a moderately fast growth rate, and will continue to keep pace with the economic growth.

Keywords: Tax Situation; Tax Revenue

18　Chinese Stock Market Review in 2015 and Its Prospects for 2016【Zhu Pingfang】／239

Abstract: This paper reflected on the rare concussion and its inherent inevitability on the Chinese stock market, reviewed the specific circumstances of the stock market fundamentals and market fundamentals, and analyzed the characteristics of the plate in the market running under the reform of cattle in 2015. The development of the securities market in 2016 was prospected. In particular, the macro fundamentals and the potential of the hot spots were judged.

Keywords: Stock Market in China; Fund Bull; Reformation Bull

Ⅵ　Taiwan, Hong Kong and Macao’s Economy

19　Analysis and Forecast for the Economy of the Taiwan Region【Zhang Guanhua, Xiong Junli】／260

Abstract: In 2015, Taiwan’s economy has been weak. Economic growth has been forecast below 1%, which is caused by three main factors: the global economic environment slowdown, the decline of industrial competitiveness, the slowdown in cross-strait economic cooperation by politics. At the end of this year, positive financial, monetary and industrial policies will have been strongly advanced by Taiwan authorities. However, the overall adverse situation is expected to give rise to an increasingly dark economic backdrop. Looking forward to the year 2016, we are not too optimistic about official economic forecasts for Taiwan.

Keywords: Taiwan Economy; Low Growth; Cross-strait Economy

20　Analysis and Prospects for Taiwan’s Economic Situation in 2016【Peng Suling, Chen Xinhui】／273

Abstract: Taiwan’s economy maintained steady development in the first three quarters of 2015. From the substantive and financial aspects, this paper analyzes the economic situation in Taiwan. On the substantive side, the international commodity trade downturns, the growth of service trade is lower than expected, private consumption tends towards the conservative, and public spending cuts austerity. On the financial side, the monetary situation is loose, and prices are rising smoothly. Based on summarizing the forecast for the economic growth of Taiwan, this paper argues that Taiwan’s economic growth rate will be 3% or less in 2016, and the forecast range is about 2%-3.3%. Overall, the economic situation in Taiwan in 2016 will show a flat growth trend.

Keywords: Taiwan’s Economy; Substantive Aspects; Financial Aspects; International Trade

21　Analysis and Prospects for the Economic Situation in Hong Kong【Chen Liailun】／288

Abstract: In 2015, the global economic growth has been worse than expected, and the output of goods and services has been weak. However, in the first three quarters, strong internal demand made the economy reach a moderate growth rate, and made the labor market maintain a state of full employment. In the short term, uncertain factors still exist in the global economy, including the U.S. Federal Reserve’s raising interest rates, deepening differences with the central bank’s monetary policy in the principle countries; these aspects pose a downside risk to global economic and financial stability. In addition, the slow recovery of developed economies, the slow growth of the markets in emerging countries, and the unstable conditions in many countries, will restrict the performance of foreign trade in Hong Kong in the short term. Therefore, in the year 2015, Hong Kong’s economic growth rate is expected to reach 2.4%, which is similar to the 2.5% of the previous year, 2014. Inflation in Hong Kong was mitigated in the first three quarters of 2015, and the local housing market was quite dull in the same period. In 2016, Hong Kong’s economy is expected to be in a fair condition, in spite of the many challenges, due to the positive relationship between Hong Kong and the Chinese Mainland.

Keywords: Hong Kong’s Economy; Hong Kong’s Property Market; Hong Kong’s Economic Development Strategy In The Long Run

22　Analysis and Forecast of Macao Economy【Task Group】／313

Abstract: Influenced by a significant drop in the gambling industry and service trade exports, Macao’s economy in 2014 fell slightly. The real growth rate of the first half of 2015 continued to shrink by 25.4%. Depending on the performance of the gambling industry, the expected economic contraction in the second half of 2015 may be 10%-15%. It is estimated that the real GDP of 2015 may shrink by 15%-20%. As the focus of Macao’s economic moderate diversification, the exhibition, retail, hotel, catering, traditional Chinese medicine, creative culture industries as well as other industries became the pioneers of a new round of transformation and upgrading of Macao’s Economy. “Regional financial center” is another development strategy of Macao’s economic moderate diversification. Hengqin will continue to perform as a main platform for the industrial diversification of Macao.

Keywords: Macao’s Economy; Revenue of Gambling Industry; HengQin Development; Regional Financial Center; Economic Moderate Diversification

Ⅶ　Appendix

23　Statistic Data／332