Reuters:

I am also interested in the economic structure. My question is, how can China replace old growth drivers with new ones? I read in a report that sectors such as NEVs and solar cells have been growing rapidly. But how can you prevent possible overcapacity while making a big push to develop advanced manufacturing? Besides, in the face of insufficient domestic demand, will such rapid expansion of these sectors result in downward pressure on the prices and international trade friction? Thank you.

Wang Guanhua:

Thank you for your questions. I will respond from two perspectives.

First, regarding the transformation of growth drivers, high-quality development is characterized by the new development philosophy, with innovation being a priority among the five concepts. Upholding innovation-driven development and promoting the transformation of growth drivers are crucial tasks in achieving high-quality development. Regardless of the adjustment and transformation of traditional growth drivers, China will unswervingly press ahead with the transition of growth drivers. Mr. Kang highlighted the achievements of China's high-quality and innovation-driven development, and I would like to provide additional data. In 2023, the value added by the equipment manufacturing industry above designated size grew by 6.8%, playing a key role in the industry's steady recovery. According to a 2023 report by the World Intellectual Property Organization, China ranked 12th in the Global Innovation Index and is home to the world's largest number of the top 100 science and technology innovation clusters. New growth drivers have become an essential engine driving high-quality development. 

Second, last year witnessed the recovery of the national economy. Market demand and domestic demand recovered well, and we all gained firsthand experience of that. Demand played a greater role in driving economic growth, and the balance between supply and demand, as well as economic circulation, improved. I will provide you with several sets of data. In the fourth quarter, the product sales rate of industrial enterprises above designated size was over 97%, and in December, it was 98.4%. The capacity utilization rates in the four quarters of 2023 were 74.3%, 74.5%, 75.6%, and 75.9%, respectively, showing a recovering trend. This reflected improved market demand and capacity utilization. At the beginning of this year, ice and snow tourism and sports have gained popularity. This follows the trend of upgrading consumer spending and demonstrates the potential of domestic demand. Therefore, we are confident in the consumption market's recovery this year.

In general, China is still undergoing a crucial period of economic recovery, transformation and upgrading. Going forward, we will continue to act on the principles outlined at the Central Economic Work Conference, which are seeking progress while maintaining stability, promoting stability through progress, and establishing the new before abolishing the old. We will consolidate and strengthen the momentum of economic recovery and promote the effective improvement of quality and reasonable economic growth. Thank you.