A Good Start for China’s National Economy in the First Quarter of 2017

National Bureau of Statistics of China

17 April 2017

Since the beginning of 2017, under the leadership of the Central Committee of the Communist Party of China with General Secretary Xi Jinping as the core, people from all regions and departments implemented the arrangements made by the CPC Central Committee and the State Council, adhered to the general working guideline of making progress while maintaining stability, steered the new normal in economic development with the new development philosophy, and advanced the supply-side structural reform. As positive changes kept emerging and major indicators performed better than expected, the national economy maintained the momentum of steady and sound development from the second half of last year, getting off to a good start in 2017 and laying a solid foundation for accomplishing the whole-year growth target.

According to the preliminary estimates, the gross domestic product (GDP) of China was 18,068.3 billion yuan in the first quarter of 2017, a year-on-year increase of 6.9 percent at comparable prices. The value added of the primary industry was 865.4 billion yuan, up by 3.0 percent; the secondary industry 7,000.5 billion yuan, up by 6.4 percent; and the tertiary industry 10,202.4 billion yuan, up by 7.7 percent. The GDP of the first quarter of 2017 went up by 1.3 percent on a quarter-on-quarter base.

1. Planting Structure was Optimized; Agricultural Production was Generally Stable

The planting intention survey on 110,000 rural households showed that the planting area intended for rice went down by 0.3 percent; wheat down by 0.8 percent; corn down by 4.0 percent; soja up by 8.1 percent; and cotton down by 0.7 percent. Currently, the winter wheat grew well, with the sown area of high- and medium-vigor seedlings accounting for 84.8 percent of the total. The output of pork, beef, mutton and poultry was 22.49 million tons, a year-on-year growth of 0.2 percent, among which the output of pork was 14.68 million tons, up by 0.2 percent. The number of pigs registered was 410.95 million, a year-on-year growth of 0.1 percent and 191.49 million pigs slaughtered, a year-on-year growth of 0.2 percent.

2. Growth of Industrial Production Accelerated with Profit for Enterprises Rising Rapidly.

In the first quarter, the year-on-year real growth rate of total value added of the industrial enterprises above designated size was 6.8 percent, 1.0 percentage point faster than that of the same period last year, 0.8 percentage point faster than the whole of last year. An analysis by types of ownership showed that the value added of the state holding enterprises went up by 6.2 percent year on year; collective enterprises up by 0.5 percent; share-holding enterprises up by 6.9 percent; and enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan up by 6.9 percent. In terms of sectors, the value added of the mining dropped by 2.4 percent on a year-on-year base, the manufacturing grew by 7.4 percent and the production and supply of electricity, thermal power, gas and water grew by 8.9 percent. The industrial structure continued to improve. The value added of high-tech industry and equipment manufacturing industry grew by 13.4 percent and 12.0 percent year on year respectively, 6.6 percentage points and 5.2 percentage points faster than that of the industrial enterprises above designated size as a whole, 2.6 percentage points and 2.5 percentage points higher than the whole of last year. The sales-output ratio of the industrial enterprises above designated size reached 97.2 percent. In March, the total value added of the industrial enterprises above designated size went up by 7.6 percent year on year, 1.3 percentage points faster than that in the first two months of 2017, or up by 0.83 percentage point month on month.

In the first two months of 2017, the total profits made by industrial enterprises above designated size was 1,015.7 billion yuan, up by 31.5 percent year on year, 23.0 percentage points faster than the whole of last year. The profit rate from principle business of industrial enterprises above designated size was 5.92 percent, 0.8 percentage point higher than that of the same period last year.

3. Service Industry Grew Fast and Maintained Strong Expansion.

In the first quarter, the index of national services production increased by 8.3 percent year on year, 0.1 percentage point higher than that of the same period last year. Specifically, information transmission, software and information technology services, and transport, storage and postal services maintained high growth rates. The growth rates of wholesale and retail trade and accommodation and catering trade picked up considerably. In March, the index of national services production increased by 8.3 percent year on year, 0.1 percentage point faster than that of the first two months, and same as that of the same period last year.

In March, the business activity index for services was 54.2 percent, 1.0 percentage point higher than that of February, 1.1 percentage points higher than that of the same month last year, continuing the expansion trend. Specifically, the business activity index for sectors like retail trade, air transport, postal services, internet and software information technology services, monetary and financial services, capital market services, and insurance all kept within the expansion range of over 55 percent.

4. The Investment in Fixed Assets Grew Steadily and the Floor Space of Commercial Buildings for Sale Continued to Decrease.

In the first quarter, the investment in fixed assets (excluding rural households) was 9,377.7 billion yuan, a year-on-year growth of 9.2 percent, 1.1 percentage points faster than the whole of last year, 0.3 percentage point faster that than in the first two months of 2017. Specifically, the investment by the state holding enterprises reached 3,308.7 billion yuan, a rise of 13.6 percent; private investment reached 5,731.3 billion yuan, up by 7.7 percent, 1.0 percentage point faster than that in the first two months, accounting for 61.1 percent of the total investment. The investment in the primary industry was 233.5 billion yuan, up by 19.8 percent year on year; the secondary industry 3,509.4 billion yuan, up by 4.2 percent, among which the investment in manufacturing was 2,932.5 billion yuan, up by 5.8 percent; and the tertiary industry 5,634.9 billion yuan, an increase of 12.2 percent. The investment in infrastructure was 1,899.7 billion yuan, an increase of 23.5 percent. The investment in high-tech industry increased by 22.6 percent, 13.4 percentage points faster than the total investment. The funds in place for investment in fixed assets in the first quarter were 10,608.1 billion yuan, down by 2.9 percent, 5.1 percentage points less than that in the first two months. The total investment in newly-started projects was 6,201.5 billion yuan, a drop of 6.5 percent year on year. In March, investment in fixed assets (excluding rural households) grew by 0.87 percent month on month.

The total investment in real estate development in the first quarter was 1,929.2 billion yuan, a year-on-year growth of 9.1 percent, 2.2 percentage points faster than last year, and 0.2 percentage point faster than the first two months. In particular, the investment in residential buildings went up by 11.2 percent. The floor space started was 315.60 million square meters, up by 11.6 percent year on year. Specifically, the floor space of residential buildings newly started went up by 18.1 percent. The floor space of commercial buildings sold was 290.35 million square meters, up by 19.5 percent. The floor space of residential buildings sold was up by 16.9 percent. The total sales of commercial buildings were 2,318.2 billion yuan, a growth of 25.1 percent. Specifically, the sales of residential buildings were up by 20.2 percent. The land space purchased for real estate development was 37.82 million square meters, up by 5.7 percent year on year. By the end of March, the floor space of commercial buildings for sale was 688.10 million square meters, 17.45 million square meters less than that at the end of February. The funds in place for real estate development enterprises in the first quarter reached 3,566.6 billion yuan, up by 11.5 percent year on year.

5. Market Sales Maintained Stable and Online Retailing Grew Fast.

In the first quarter, the total retail sales of consumer goods reached 8,582.3 billion yuan, a year-on-year rise of 10.0 percent, 0.4 percentage point less than the whole of last year. Specifically, the retail sales of the enterprises above the designated size stood at 3,746.0 billion yuan, up by 7.9 percent. Analyzed by different areas, the retail sales in urban areas reached 7,339.8 billion yuan, up by 9.7 percent, and the retail sales in rural areas stood at 1,242.6 billion yuan, up by 11.9 percent. Grouped by consumption patterns, the income of catering trade was 919.6 billion yuan, up by 10.8 percent; and the retail sales of goods were 7,662.7 billion yuan, up by 9.9 percent. In particular, the retail sales of the enterprises above designated size reached 3,524.8 billion yuan, an increase of 7.9 percent. Upgraded consumer goods grew fast. The retail sales of cultural and office goods went up by 14.8 percent; communication equipments up by 11.0 percent; sports and recreational articles up by 17.3 percent; furniture up by 12.6 percent, and building and decoration materials up by 14.8 percent. In March, the total retail sales of consumer goods rose by 10.9 percent year on year, 1.4 percentage points faster than the first two months, an increase of 0.84 percent month on month

In the first quarter, the online retail sales reached 1,404.5 billion yuan, a year-on-year growth of 32.1 percent, among which the online retail sales of physical goods were 1,067.4 billion yuan, an increase of 25.8 percent, accounting for 12.4 percent of the total retail sales, a year-on-year increase of 1.8 percentage points.

6. Total Value of Imports and Exports Increased Rapidly with Improved Structure of Foreign Trade.

The total value of imports and exports in the first quarter of 2017 was 6,198.6 billion yuan, an increase of 21.8 percent year on year, while that of the whole of last year went down by 0.9 percent. The total value of exports was 3,326.8 billion yuan, up by 14.8 percent; the total value of imports was 2,871.8 billion yuan, an increase of 31.1 percent. The trade balance was 454.9 billion yuan in surplus. The percentage of general trade increased. In the first quarter, the import and export of general trade increased by 23.2 percent, accounting for 56.2 percent of the total value of the imports and exports, an increase of 0.6 percentage point compared with the same period last year. The export of mechanical and electronic products still took the lead. In the first quarter, the export of mechanical and electronic products increased by 15.1 percent, accounting for 58.1 percent of the total value of exports. The imports from and exports to some countries along the Belt and Road went up. In the first quarter, the exports to Russia, Pakistan, Poland, Kazakhstan and India increased by 37.0 percent, 18.7 percent, 19 percent, 69.3 percent and 27.7 percent. In March, the total value of imports and exports was 2,314.2 billion yuan, a year-on-year increase of 24.2 percent. The total value of exports was 1,239.3 billion yuan, up by 22.3 percent, and the total value of imports was 1,074.9 billion yuan, up by 26.3 percent.

In the first quarter, the export delivery value of industrial enterprises above designated size reached 2,794.6 billion yuan, a year-on-year increase of 10.3 percent. In March, the export delivery value of industrial enterprises above designated size reached 1,073.7 billion yuan, up by 12.9 percent.

7. The Consumer Price Increased Mildly and the Increase of Industrial Product Price Slowed Down.

In the first quarter, the consumer price went up by 1.4 percent year on year, 0.7 percentage point less than the same period of last year. Specifically, the price went up by 1.5 percent in the urban areas and 1.1 percent in the rural areas. Grouped by commodity categories, prices for food, tobacco and alcohol went down by 0.8 percent year on year; clothing up by 1.2 percent; housing up by 2.4 percent; articles and services for daily use up by 0.6 percent; transportation and communication up by 2.0 percent; education, culture and recreation up by 2.5 percent; medical services and health care up by 5.1 percent; other articles and services up by 3.6 percent. In terms of food, tobacco and alcohol prices, prices for grain went up by 1.3 percent, pork up by 0.9 percent, fresh vegetables down by 18.8 percent. In March, the year-on-year consumer prices were up by 0.9 percent, 0.1 percentage point more than that of February and down by 0.3 percent month on month.

In the first quarter, the producer prices for industrial products went up by 7.4 percent year on year, while that of the same period last year went down by 4.8 percent. In March, the producer prices for industrial products went up by 7.6 percent year on year, 0.2 percentage point less than that in February. In the first quarter, the purchasing price for industrial producers was up by 9.4 percent year on year; In March the price went up by 10.0 percent year on year, and 0.5 percent month on month.

8. Residents’ Income Grew in Line with the Economic Development and Rural-Urban Disparity Continued to Narrow Down.

In the first quarter of 2017, the national per capita disposable income was 7,184 yuan, a nominal growth of 8.5 percent year on year or a real growth of 7.0 percent after deducting price factors. The growth rate of income was 0.1 percentage point higher than that of GDP. In terms of usual residence, the per capita disposable income of the urban residents was 9,986 yuan, a real growth of 6.3 percent after deducting price factors. The per capita disposable income of the rural residents was 3,880 yuan, up by 7.2 percent in real terms. The per capita income of the urban residents was 2.57 times of that of the rural residents, 0.02 less than the same period last year. The median of the national per capita disposable income was 6,067 yuan, a nominal increase of 6.7 percent. The per capita expenditure nationwide was 4,796 yuan, a nominal increase of 7.7 percent, or 6.2 percent after deducting price factors. By the end of February, the number of rural migrant workers was 172.53 million, which was 4.54 million more than the same period last year, or up by 2.7 percent. The monthly income of migrant workers was 3,482 yuan, a year-on-year increase of 6.4 percent.

9. The Supply-Side Structural Reform was Intensified and the Economic Structure was Further Optimized.

Efforts of cutting overcapacity, reducing inventory, deleveraging, lowering costs and strengthening weak links have made new progress. In the first quarter, the capacity utilization rate of industrial enterprises above designated size was 75.8 percent, 2.0 percentage points higher than that in the fourth quarter of 2016. The output of coal decreased by 0.3 percent year on year. At the end of March, the floor space of commercial buildings for sale decreased by 6.4 percent year on year, 3.2 percentage points more than that at the end of last year. The asset-liability ratio and cost of industrial enterprises both decreased. At the end of February, the asset-liability ratio of the industrial enterprises above designated size was 56.2 percent, 0.6 percentage point less than the same period last year. For the first two months, the cost for per-hundred-yuan turnover of principle business of the industrial enterprises above designated size was 84.91 yuan, 0.28 yuan less year on year. The investment in weak areas grew rapidly. In the first quarter, the investment in the management of ecological protection and treatment of environment pollution, management of public facilities, agriculture and management of water conservancy increased by 48.1 percent, 27.4 percent, 24.6 percent and 18.3 percent respectively, or 38.9 percentage points, 18.2 percentage points, 15.4 percentage points and 9.1 percentage points higher than the total investment.

The industrial structure continued to be optimized. In the first quarter, the value added of the tertiary industry accounted for 56.5 percent of GDP, 17.8 percentage points higher than that of the secondary industry. The demand structure was further improved. In the first quarter, the final consumption expenditure’s contribution to GDP was 77.2 percent. New driving forces grew fast. In the first quarter, the value added of strategic and emerging industries went up by 10.3 percent year on year, 3.5 percentage points faster than that of the industries enterprises above designated size. Energy conservation and consumption reduction have achieve stable progress. In the first quarter, the energy consumption per unit of GDP dropped by 3.8 percent year on year.

Generally speaking, the national economy in the first quarter has maintained the momentum of steady and sound development. Economic growth rate picked up slightly; structural adjustment was continued; innovation and development gathered speed; people’s livelihood was improved steadily and effectively; positive factors were accumulated; all showing a good start of the national economy. However, we should also be aware that the conditions are still complicated abroad, that the structural contradictions are prominent at home, and that the momentum of stable but progressing economy should be further consolidated. Next step, we should rally closely around the CPC Central Committee with General Secretary Xi Jinping as the core, put in practice the guiding principles of the Central Economic Work Conference and the arrangements made in the Report on the Work of the Government, stick to the general working guideline of making progress while maintaining stability, implement the new development philosophy, insist on the mainline of supply-side structure reform, appropriately expand the aggregate demand, effectively shape social expectations, strengthen the role of innovation in driving development, “roll up our sleeves to work harder”, so as to sustain the good momentum for a steady and sound development of national economy.

Notes:

1. The growth rate of gross domestic product, value added of industrial enterprises above designated size and its sub-items are real growth by using comparable prices. The growth rates of other indicators are nominal growth by using current prices unless otherwise specified.

2. According to the auto-revision function of the seasonal adjustment model, GDP in each quarter and the month-on-month changes of the value added of industrial enterprises above designated size, investment in fixed assets (excluding rural households), and total retail sales of consumer goods have been revised. The revised figures, quarter-on-quarter GDP data for the first quarter of 2017 and other indicators for March 2017 are as follows:

The quarter-on-quarter growth of GDP in 2016 and the first quarter of 2017 were 1.3 percent, 1.9 percent, 1.8 percent, 1.7 percent, and 1.3 percent respectively.

3. Industrial enterprises above the designated size are industrial enterprises with annual revenue from principle business over 20 million yuan.

4. Enterprises above the designated size in total retail sales of consumer goods include wholesale enterprises, retail enterprises and lodging and catering enterprises with annual revenue from principle business over 20 million yuan, 5 million yuan and 2 million yuan respectively.

Online retail sales refer to the retail sales of goods and services realized through internet trading platforms (including self-built websites and third-party platforms). Goods and services include physical goods and non-physical goods (e.g. virtue goods and services).

5. The median of national per capita disposable income of urban and rural households refers to the per capita disposable income of households which lies in the middle of all surveyed households ranked from low to high on the basis of per capital disposable income level.

6. Migrant workers refer to the rural labor force who obtained employment outside their registered towns and townships at the reference time of the survey.

7. Data of imports and exports are from the General Administration of Customs.

8. Due to the round-off reasons, the subentries may not add up to the aggregate totals.

In case of any differences between English translation and the original Chinese text, the Chinese edition shall prevail.