Chinese Official Reaffirms ‘Rebalancing’ of Economy

In doing so, the official, Zhang Ping, the chairman of the National Development and Reform Commission, glossed over recent data that suggested the reverse might be happening.

Mr. Zhang, whose agency oversees economic planning and coordinates the country’s economic ministries, said in a news conference held in conjunction with the 18th Party Congress that the Chinese economy was growing again, crediting government policies aimed at moving China away from its reliance on capturing an ever greater share of overseas markets for its exports. He also claimed success in easing the economy’s dependence on enormous investment, which has become less efficient and less productive as many industries struggle with overcapacity.

“Starting from August, the turn toward a slower economy has been effectively curbed,” Mr. Zhang said. “From the October economic data, we can see that the trend toward a rebalancing of the Chinese economy is all the more obvious.”

But independent economists question whether any such conclusion is justified. China’s General Administration of Customs announced on Saturday morning that the country’s trade surplus in October had soared to $32 billion, the highest level in nearly four years. Exports surged 11.6 percent from a year earlier, while imports rose 2.4 percent.

Chinese officials are acutely conscious of the frictions that their trade surpluses create with importer nations like the United States, and have argued for many years that the surpluses are temporary and should not be an issue because they might soon disappear. President Obama and Mitt Romney, the Republican nominee, vied during the presidential election campaign over who could be tougher in trade and currency disputes with China over the next four years.

Commerce Minister Chen Deming tried again on Saturday to allay foreign concerns about rising Chinese exports, describing the surge as unlikely to last. He said exports would probably not remain strong because of economic troubles in overseas markets and because of what Mr. Chen described as an international rise in protectionism.

“The trade situation will be relatively grim in the next few months,” he said, “and there will be many difficulties next year.”

Investment has also surged rapidly this autumn, government statistics released on Friday showed, as state-owned banks have lent heavily to state-owned enterprises.

A series of news conferences on economic policy — a third was held on Saturday evening on efforts to encourage industrial innovation — came as the 2,268 delegates to the Party Congress attended closed-door meetings on the third day of the gathering, which is held every five years. The Congress is scheduled to choose a new Central Committee of the Chinese Communist Party this coming week, and that committee will approve a list of leaders who are expected to run the country for the next decade.

Mr. Zhang said in his news conference that the economy was becoming less reliant on exports and investment spending. He omitted October in citing data from 2012’s first nine months that he described as showing that consumption had been playing a bigger role than investment in economic growth. He also said exports had been a drag on growth.

But investment, which had slumped early this year as the government limited bank lending and restricted real estate sales to pop a housing bubble, has been bouncing back as the restrictions have been eased. Exports were also very weak early this year because of Europe’s difficulties, but are strengthening as American demand rebounds.

Wang Tao, a China economist at UBS in Hong Kong, said short-term changes in various sectors of the economy made it hard to draw any reliable conclusions about whether policy makers had been able to shift the foundations of the Chinese economy onto a firmer and more sustainable footing.

But she expressed skepticism that any fundamental shift had taken place so far, saying: “These are cyclical moves. Rebalancing happens very slowly.”

At the news conference on innovation, corporate executives expressed concern about China’s ability to create its own inventions. But Liang Wengen, the president of Sany Heavy Industry, a big construction equipment manufacturer, answered a last question on American investment policies.

Mr. Liang is widely viewed as a well-connected industrialist with the best chance of becoming the first business tycoon to join the Central Committee, possibly this coming week. He bitterly criticized the Obama administration on Saturday evening for its decision not to allow an American company owned by Sany executives to install Sany-made wind turbines in or near restricted airspace next to a United States Navy site where drones are developed.

Mr. Liang promised a long legal battle against the decision, saying: “We will fight to the end. We hope we will achieve final victory, because we believe in the justice of U.S. law, the courage of the American people and the justice of the world.”

Patrick Zuo contributed research.

Article source: http://www.nytimes.com/2012/11/11/world/asia/chinese-official-reaffirms-rebalancing-of-economy.html?partner=rss&emc=rss