MNI China Press Digest Aug 7: Economy, Public Revenue, ODI

Highlights from Chinese press reports on Thursday:

• China’s Chief Economist Confidence Index rose to 50.2 in August, surpassing the 50-point boom-bust threshold after recording 49.9 in July, Yicai News Agency reported. Guan Tao, chief economist at Bank of China International Securities, stated that achieving the annual economic growth target of around 5% this year is well within reach. However, due to ongoing external uncertainties, macroeconomic policy will remain supportive to sustain the economy’s upward momentum. Guan, who was also a former senior official at the State Administration of Foreign Exchange, noted that fiscal policy will focus on leveraging existing policy space, accelerating expenditure and promoting government investment. Monetary policy will concentrate on enhancing the transmission mechanism, deepening financial supply-side structural reforms and consolidating the outcomes of earlier policy measures, Guan added.
• China’s national local general public budget revenue rose 1.6% year-on-year in the first half, while tax revenue declined in many provinces, reflecting persistent pressure on fiscal revenue growth, Yicai News Agency reported. Wang Zhenyu, director of the Local Finance Research Institute at Liaoning University, stated that the data points to a weak recovery in local government finances during the first half and the foundation remains fragile. He noted that while local fiscal revenue is expected to continue growing in the second half, potential fluctuations in the third quarter warrant close monitoring and timely policy reinforcement.
• China’s manufacturers should increase their globalised layout to better balance labour, tariffs and shipping costs, and align closely with host countries' market demands, according to senior researchers at the Chinese Academy of Macroeconomic Research, in an article published by The People’s Daily. Manufacturing globalisation provides strategic opportunities to break through traditional market boundaries and innovation bottlenecks, the researchers said. To expand overseas, firms must leverage local industrial development models, strengthen cooperation with local companies and fulfil social responsibilities.