China's economy to face more uncertainties in Q1: NDRC

In the first quarter of 2022, China's economy will be facing more uncertainties, and as countermeasures, the Chinese government will bring forward the implementation of some policies, the progress of some infrastructure construction projects, and execution of some domestic demand boosting efforts, Yuan Da from the country's National Development and Reform Commission (NDRC) shared at a press conference on January 18.

"China's economic development for 2022 will face quite some challenges and pressure, among them are the impact of consumption in some Chinese cities by the outbreaks of COVID-19 cases, lower growths in investments, and greater uncertainties in imports and exports," he said.

"Some Chinese enterprises may face shortages of production materials, medium, small and micro-sized enterprises may still face difficulties in business and operations, and the market sentiment and enterprises' confidence may be dampened too (amid the greater uncertainties)," he added.

To have a good start of 2022, Beijing will accelerate the progress of 102 key projects for the 14th Five-Year Plan period (2021-2025), and as for infrastructure construction projects, the focus will be on the traditional ones such as transport, energy, water conservation and irrigation, agriculture, environmental protection and logistics, affordable housing, and civil engineering projects as well as new ones such as 5G, data centre and Industrial Internet, he elaborated.

Besides, China will increase the investment in the manufacturing sector to aid the related enterprises with their energy saving, decarbonization, upgrading and optimization in location, according to him.

For 2022, China's central government will stick to the general principle of stability and then progress, maintaining the economic growth within a reasonable range, and China's active fiscal policy will accordingly focus on fast and sufficient fiscal support, as well as granting taxation and fee reliefs to medium, small, and micro-sized enterprises, self-employed citizens, and domestic manufacturers.

The country's monetary policy will remain steady with moderate flexibility to ascertain reasonably sufficient capital flow and encouraging financial institution's support to real economy with lower costs.

As for the power supply shortage and auto chips, China has made some progress, as now the thermal coal stocks for power generation will be sufficient for 20 days and coal prices have subsided substantially, and integrated circuit output grew 33.3% on year for 2021 with auto chip supplies on the rise, enabling the country's auto production up on month for the fourth month by December, according to Yuan.

Li Yunqing, another NDRC official present at the press conference, elaborated that by January 16, thermal coal stocks at the power houses under the management of the national grid reached a record high of 166 million tonnes or equivalent to 21 days of consumption.

In the fourth quarter of 2021, coal transport via rail grew 20% on year in China, and coal throughputs at the ports in North China had been refreshing their respective records, indicating that coal transport in China will be guaranteed, according to him.

Li warned, though, that China's power consumption may continue with a relatively high growth, noting that in 2021, the country's power consumption grew 10.3% on year, or 1.4 percentage points higher than the average growth over the 13th Five-Year Plan period (2016-2020).

Official data also showed that China's 19 provinces, autonomous regions and municipalities posted their power consumption up over 10% on year in 2021, among which Tibet, Qinghai, Hubei, Jiangxi, Zhejiang, Sichuan, Fujian, and Guangdong were the eight with their power consumption up over 13% on year, Jin Xiandong, a third NDRC official at the press conference, added.

Other than boosting domestic demand for its economic growth, China has also been actively seeking development opportunities in the overseas market, he pointed out, sharing that by the end of 2021, China had signed cooperative agreements with 147 countries and 32 international organization under the "Belt and Road Initiative".

As for 2022, China's financial institutions, state-owned enterprises and property developers may issue more "green development" financial products in the global market to sponsor their businesses under Beijing's "carbon emission peak" and "carbon neutral" plans, he added.

In 2021, Chinese enterprises already issued 58 "green development" bonds including medium and long-term with the value totalling $21.47 billion, or up 162.8% on year, and 12 "sustainable development" bonds, or 12 times of the previous year, according to him.