Industrial Restructuring Help Cut Down in Electric Consumption and Freight Transportation
Industrial restructuring in China helped in the cutting down of electric consumption and freight transportation as the economy maintained a medium to high growth rate in the first six months. According to Zhang Xiaoqiang the executive deputy director for China Center for International Economic Exchanges. He said that although there were doubts on the economic growth rate in China in the first half since two key indicators of economic growth namely power consumption and freight volume have dropped significantly.
The Gross Domestic Product expanded 7 percent for the first six months of this year compared to the same period last year which went down slightly by 7.4 percent. Power consumption however expanded by 1.3 percent only during the first six months lower than 5.3 percent last year meanwhile the freight volume expanded 4.2 percent which is also down by 7.5 percent last year. the industrial sector grew in a much slower pace in the first six months and the service sector became a major engine for economic growth, while the industrial sector consumes more energy per unit of Gross Domestic Product compared with the service sector.
Meanwhile in freight transportation, the coal, steel and cement industry is subjected to restructuring and because of this their output dropped which led to the slowdown in the growth. The discrepancy between the economic growth and the two key indicators growth for the first six months didn’t friend with the previous patterns although industrial restricting is considered a new factor and must be taken into account in analyzing a new situation.