Report details unusual, temporary economic trends in 2020

As the Chinese economic recovery gathers steam, the country is heading to healthy and strong growth in 2021, with changes in the structure of supply and demand already presenting themselves according to a yellow book by the Institute of World Economics and Politics under the Chinese Academy of Social Sciences.

For a short period, growth rate in industrial output will be stronger than that of the service industry on the supply side, while on the demand side fixed-asset investment will perform better than consumption, and tangible commodity consumption will outperform service consumption. These assertions were made in the Yellow Book of World Economy, which was jointly released by the institute and Social Sciences Academic Press on Monday in Beijing.

These changes deviate to a certain extent from the long-term structural change trends of the Chinese economy. That is, the service industry will expand to have a stronger presence in the overall economy than the secondary industry, according to the yellow book.

China's year-on-year growth rate of the index of services production was always higher than industrial output before the outbreak of COVID-19, which then reversed in March. The index of services production, or ISP, is a business indicator which measures the monthly changes of the price-adjusted output of the service industries.

In August, industry output increased 5.6 percent on a yearly basis, higher than the 4 percent year-on-year growth rate of ISP.

Small and medium-sized enterprises in the manufacturing sector also outperformed those of the service sector in several areas, including financing, sales, purchasing, size expansion, confidence and exposure to risk, while electricity consumption in secondary industries also recovered faster than the service industry.

The prosperity index by industries, published by the National Bureau of Statistics for the second quarter, also showed heavy industries demonstrated higher vitality than light industries, while light industries were better than service industries in terms of vitality, it said.

However, as service industries rebound due to service demand recovery, such a trend will not last long.

China's industrial output went up 7 percent on a yearly basis in November, data from the NBS showed.

Growth accelerated from a rise of 6.9 percent registered in October. In the first 11 months, value-added industrial output expanded by 2.3 percent over a year ago, 0.5 percentage points higher than the rise for the first 10 months.

On the other hand, the ISP in November increased 8 percent year-on-year, up 0.6 percentage points on October.

Although ISP declined 0.7 percent in the first 11 months on a yearly basis, the decline narrowed 0.9 percentage points compared to the first 10 months.

The two organizations also released the Annual Report on International Politics and Security 2021 on the same day.