Li Daokui: China'S Economy Has Formed A V Shaped Rebound Pattern.

The Greek debt crisis set off a "debt bomb" in Europe, causing huge fluctuations in the financial markets and triggering a two dip in global economic growth.

Is Greece in danger of turning Chanyman second into a new round of global financial turmoil? Will the weak recovery of the world economy be aborted? Will China's external demand further shrink? In this connection, we have interviewed the chairman of the central bank's monetary policy committee and Li Daokui, director of the China and world economic Research Center of Tsinghua University. He believes that the V rebound pattern of China's economy has been formed.

　　歐債危機不會延緩復蘇

Q: will the European debt crisis raid the terrorist consequences of the subprime mortgage crisis and escalate it to the second financial tsunami?

Li Daokui: the outbreak of the Greek debt crisis means that financial risk has shifted from private financial sector to sovereign credit pfer. Its manifestation is the deterioration of the balance sheet of private sector in developed economies, and the decline of sovereign credit ratings in some European countries. Pessimists believe that the signs of recovery in the world's economy will fade, and the external demand of China's economy will shrink further, and the V rebounding will disappear.

However, I think the danger of this crisis will be far less than before, and there will not be a financial tsunami. Because of the unclear understanding of the nature of the financial crisis in 2008, governments failed to realize what the balance sheet crisis meant, so that their rescue measures were delayed and even missed the best rescue time.

But in the end, they were fully aware of the nature of the crisis, adopted a strong quantitative easing monetary policy, and set the foundation of national credit to rescue the private financial sector.

It is with prior experience that the financial panic is not enough for governments to make their own mess.

Central banks have realized the nature of the new crisis.

So we see that the European Union and the International Monetary Fund have jointly launched a 750 billion euro rescue plan, which will play a huge role in stabilizing the financial market and enhancing investor confidence.

Q: will the European debt crisis drag down the global economic recovery?

Li Daokui: this European sovereign debt crisis has basically ended there.

Financial markets may have doubts and may be turbulent, but such doubts and unrest can not be spread into a global financial panic and can not affect the pace of economic recovery in the whole world.

In fact, Greece, Portugal and Spain are only "small points" in the western developed countries, which are not enough to shake the whole building.

The pace of economic recovery in the western developed countries will not change because of the Greek crisis episode.

The financial crisis has hurt the western countries and faces the problem of stagflation in the future.

But for a long time in the future, the locomotive of the world economy will be emerging market countries.

Therefore, the prospect of world economic growth is still very good.

　　中國經濟存在輕微過熱

Q: at present, the market is worried about the European debt crisis that may spread to China's economy. How do you judge the current Chinese economy?

Li Daokui: economic pformation is fundamental. The pain in pition is being magnified, and the opportunities in pition have not been valued by the market. I think there are many opportunities.

There is indeed a slight overheating in China's overall economy. According to the prediction by the China and world economic research center of Tsinghua University, GDP growth will reach 10.9% this year.

At present, the slight overheating of the economy is mainly manifested in the following aspects: first, the surge in domestic demand has boosted import growth. We expect import growth in 2010 to be as high as 43.9%. Secondly, the number of enterprises is relatively high and the utilization rate of capacity is relatively high; third, fixed asset investment will continue to run at a high speed; as the economy is on the rise, private enterprises will increase their investment correspondingly; consumer confidence has also risen rapidly. According to the survey report on China's consumer confidence released in the first quarter of 2010, jointly released by the China Economic Prosperity Monitoring Center and the Nielsen Co, China's consumer confidence has shown a continuous increase in the first quarter and has rebounded to the level before the financial crisis.

Q: what is the trajectory of China's economic growth in the future?

Li Daokui: the pattern of China's V rebound has come into being, and the foundation for supporting the V rebound is the rapid growth of consumer demand and the growth rate of over 15%.

There will be no doubt that the growth of fixed assets investment will last around 25%, and the external demand will not shrink accordingly.

At present, China's economic growth depends on the rapid increase of infrastructure investment and consumption, which is different from the development pattern of the past ten years, and it used to depend on real estate investment.

The urgent task at present is to speed up the reform of the income distribution system and stabilize the income growth expectation of residents so as to consolidate the growth foundation of consumer demand.

Only in this way can we establish a stable domestic demand, rather than relying too much on the abnormal development of investment demand.

　　政策調控節奏穩健

Q: the price index for the first four months of this year has increased by 2.4%, which has exceeded the one-year deposit interest rate of 2.25%, and officially entered the era of negative interest rates.

Is timing ripe for adjusting interest rates to recover liquidity?

Li Daokui: with the rise of CPI (consumer price index), the inflation pressure will become more apparent in the future.

Preventing inflation from exceeding expectations will become the main goal of China's macroeconomic regulation for a period of time.

Although CPI is still below 3%, the pressure of cost driven inflation is very large in the second half of this year and next year. It is embodied in three aspects: rising labor and labor costs, rising international raw material prices and rising costs of agricultural production caused by bad weather conditions.

There is indeed a lot of inflationary pressure. We expect CPI to reach 3.7% this year, and the trend of inflation will continue in the future.

The basic conditions for the adjustment of deposit interest rate have been formed, and the interest rate of loans has been basically marketed.

Even raising loan interest rates has limited impact on SMEs, because their main problem is not getting loans, rather than raising interest rates too high.

Therefore, for small and medium-sized enterprises, the focus should be to find ways to make China's financial system better serve them.

China should adhere to a moderately loose monetary policy, while continuing to control the risk of excessive asset price rise and appropriately raise deposit interest rates.

Its main purpose is to stabilize inflation expectations and safeguard the economic interests of depositors as far as possible.

Q: the implementation of the new round of real estate regulation and control policy has been more than a month. At present, the property market is still in the "chaotic stage". What is the future trend of the property market regulation measures?

Li Daokui: this round of real estate regulation is different from the past. It will be the starting year for the second real estate and housing system reform in our country.

The current adjustment policy of real estate should be unswervingly pushed forward.

Controlling the rapid rise of real estate prices is crucial for the vast number of urban residents, the process of urbanization, and the healthy development of the entire Chinese economy. It is a major strategic measure to consolidate the foundation for long-term economic development.

We will continue to control investment and speculative demand in the real estate market, and promote local fiscal reform. We should encourage local governments to finance housing with policy based housing and change the situation of over reliance on land sales.

If this reform is in place, not only will the foundation of local finance be more solid, but the investment of policy housing will flourish, which can largely compensate for the drop in the pure commercial residential real estate investment.