China’s economy still in medium-speed growth stage – central bank advisor

BEIJING (Reuters) -China’s economy is still in a stage of medium-speed growth of about 5%, and there may be the potential for it to continue to grow at this rate for another five to 10 years, a central bank advisor said on Wednesday.

The country needs to maintain a relatively loose monetary and fiscal policy, while paying more attention to discover its potential through structural reforms, Liu Shijin, a member of the People’s Bank of China’s (PBOC) monetary policy committee, told the Financial Street Forum in Beijing.

“For the Chinese economy which is currently on a medium-speed growth stage, macro policy focuses on short-term stability and balance,” said Liu.

“China is still in the stage of medium-speed growth of about 5%, and it is possible to have the potential of medium-speed growth for five to 10 years.”

China is scrambling to revive growth after a brief post-COVID-19 bounce faltered amid a protracted property market slump and local government debt risks.

Traditional engines of economic growth – infrastructure, real estate and exports – have gradually slowed, said Liu, adding that China needs to find out a new growth model.

To achieve that, the country needs to promote consumption needs of middle and low income groups. China also needs to grasp opportunities in the process of tech innovation, such as digital and green transformation, he said.

(Reporting by Ziyi Tang, Ethan Wang and Ryan Woo in Beijing, Twinnie Siu in Hong Kong;Editing by Tomasz Janowski and Emelia Sithole-Matarise)