When Premier Li Keqiang spoke at the World Economic Forum in Tianjin last Wednesday, he probably already had economic data for August, which had not yet been released, in mind. He said the government would not be distracted by short-term fluctuations in individual economic indicators and would maintain its focus on structural adjustments and dealing with long-term issues.
Three days later, figures from the National Bureau of Statistics took the market by surprise. Industrial output rose 6.9 percent year-on-year in August, the slowest pace since 2008 amid the global financial crisis and a sharp drop from 9 percent in July.
Fixed-assets investment, an important driver of economic activity, slowed to a 14-year low of 16.5 percent in the first eight months of the year. In particular, electricity output - a closely watched economic indicator - dropped 2.2 percent.
"Growth slightly higher or lower than the 2014 target of 7.5 percent is acceptable as long as employment, incomes and environmental protection improve," Li said in Tianjin.
Trey McArver, a London-based consultant specializing in Chinese business, said: "The new emphasis could signal an attempt by (Li) to move the focus of economic policy away from headline growth targets. To maintain growth at the current 'around 7.5 percent' target will necessitate continued inefficient investment that will exacerbate the current imbalances."
.jpg)
 
