China to keep 2015 growth, policy steady under 'new normal'(2)

NEW NORMAL -- THE KEY WORD

"New normal" is a key word in the statement and also a buzzword in China's key economic policy documents this year.

China must "understand the new normal, adjust to the new normal and develop under the new normal," said the statement.

Coming to terms with the "new normal" will be the "main logic" for economic growth for some time, it added.

"New normal" is nothing new. It was first popularized by the California-based bond fund giant Pacific Investment Management Co. to describe below-average growth after the global crisis.

The term gained ground in China when in May, President Xi Jinping, during his inspection tour in central China's Henan Province, described the need to adapt to a "new normal" and remain cool-headed as the brakes are applied.

There used to be an "old normal" in the 35 years between 1978 and 2013, when annual growth of the Chinese economy averaged close to 10 percent and, between 2003 and 2007, it was over 11.5 percent.

The "new normal" is characterized by a shift from high speed growth to a medium-to-high one, a shift from focusing on quantity and speed to quality and efficiency in growth model, a shift from stressing production expansion to improving current production, and a shift from growth being driven be conventional engines to increasingly driven by new ones.

The new normal concept does not necessarily change the fact that China is still in a strategically important period with great prospects, nor does it change the positive fundamentals of the Chinese economy. The new normal asks for the change of development mode and economic structure, said the statement.

SPEEDING UP REFORMS, OPENING-UP

Reforms will be even higher on the economic agenda for 2015, as the Chinese government will accelerate reforms in nine areas next year including the capital market and market access for private banks.

Reform will be sped up in administrative approval, investment, pricing, monopolies, franchising, government purchased services, and outbound investment. This takes into consideration both the needs for the next year and long-term interests, according to the statement.

More efforts will be made to transform the reform into growth, said the statement. The evaluation system for reform and the mechanism for general public to assess the reform work will also be improved.

The problems of state-owned enterprises will be addressed and efforts will be made to improve their efficiency and core competitiveness.

Private and foreign companies can also expect more opening up in the Chinese economy.

In the meeting, the leaders decided to expand market access in the service sector, further open up the manufacturing sector, and popularize experiences of the China (Shanghai) Pilot Free Trade Zone.