The New Normal of China's Economy

Based on an examination of national and international background, this report analyzes the concept of China's New Normal Economy, emphasizing on its conceptual changes, economic theory foundations, and its practical background. This report proposes that China's New Normal Economy is a new "market economy normal" during a time when the eight dividends (namely, the dividends of population, productivity, urbanization, economic structure, reform, resource, environment, and net export) gradually shrink or vanish. Under the new normal, economic growth at the past super-high speed under "non-market economy normal" will slow down to ordinary speed under "market economy normal." The slowing down of economic growth would be gradual but irreversible. In order to maintain a stable and continuous economic growth under the new normal, this report provides seven strategic measures, including: comprehensive reform strategy to cope with shrinking reform dividend; information driven development strategy to cope with shrinking productivity dividend; human resource nurturing strategy to cope with shrinking population dividend; circular economy strategy to cope with resource and environmental dividends; substantial urbanization strategy to cope with shrinking urbanization dividend; manufacturing and emerging industries upgrading strategy to cope with shrinking structural dividend; and service and trade improvement strategy to cope with shrinking net export dividend.