What to expect from Made in China 2025 and China’s first Belt and Road Forum
The China Economic Quarterly is a market outlook prepared on a quarterly basis by PwC to share the latest economic and policy updates. In this third quarter update, the overview of China’s macro trends are followed by a summary of the main policy developments and hot topics of interest such as policy updates for a new economic zone Xiong’an New Area, insights into the “Made in China 2025” initiative and the Belt and Road Forum for International Cooperation to be held in Beijing on 14 and 15 May 2017.
China’s economic growth in the first quarter of 2017 delivered a much better result than market expectations. GDP increased by 6.9% year-on-year – the highest growth over the past five quarters, thanks to more pro-active fiscal stimuli and continued expansionary monetary policies.
Here are some highlights of the report:
- The primary, secondary and tertiary (services) industries all grew, with services as a share of GDP reaching a new high of 56.6% and contributing 61.7% to overall economic growth.
- In the first quarter of 2017, China maintained its expansionary monetary policy. The increments of Aggregate Financing to the Real Economy (AFRE) were RMB 6.93 trillion, which was RMB 226.8 billion more than the same period last year.
- In a bid to address severe traffic congestion and air pollution in Beijing, the Chinese government announced a historic plan on 1 April 2017 to create Xiong’an New Area, a new economic zone about 100 km southwest of Beijing, with an initial area of around 100 square km and eventually expanding to nearly three times the size of New York City.
- “Made in China 2025” is China’s first ten-year plan for manufacturing expansion and upgrading and has attracted criticisms for being “problematic” with the potential to be used to “discriminate against foreign firms in favour of Chinese competitors”.