Reuters:

In the first half of the year, China pursued intensified fiscal policies, like the tax cut of two trillion yuan and the issuance of special bonds worth 2.15 trillion yuan. However, some people don't think these policies have yielded obvious results in terms of data. How will you comment on that? And against the backdrop of the trade tension, is there any new policy in the second half of year to guarantee this year's growth target? Moreover, could you tell us the contribution of gross capital formation and the net exports of goods and services to GDP growth? Thank you.

Mao Shengyong:

In the first half of this year, the contribution made to GDP growth by consumption, gross capital formation and the net exports of goods and services were respectively 60.1%, 19.2% and 20.7%. 

In regard to the counter-cyclical adjustments, there is both a proactive fiscal policy and a prudent monetary policy. Since the end of last year, in order to cope with the external uncertainties and downward pressure on the Chinese economy, a series of policies have been released and vigorously implemented. For example, we have pursued a proactive fiscal policy with greater intensity and enhanced its performance, adopted a prudent monetary policy that retained an appropriate degree of flexibility and pursued a proactive employment policy with full force. With regard to fiscal policies, we have increased expenditures including raising intensity and pace of special bonds issuance as well as increasing their amounts. Moreover, more efforts have been made to cut taxes and fees. These policies have been starting to pay off since April and May. Our survey shows that enterprises have benefited from cutting taxes and fees. The statistics also show that the growth of investment in infrastructure accelerated during the Jan-June period, and the growth of investment in the manufacturing sector also rebounded in the last two months. All these indicate that the relevant policies have produced results and we expect them to continue to pay off in the second half of the year.

However, it is worth noting that investments in some sectors, including manufacturing and infrastructure, are still at a low level. We will, with more policies being implemented, continue to deepen reforms, improve the business environment and further invigorate market entities. We expect a better economic performance in the second half of the year. Thank you.