China's new growth engine taking shape: Economist

Next Big sign on the third floor of 3W Coffee in Zhongguancun, Beijing's Haidian district, May 18, 2015. Next Big sign symbolizes the meaning that any entrepreneur here can become the next tech giant in China. 3W Coffee, a meeting place for budding entrepreneurs in Zhongguancun, Beijing's technology hub in the Haidian district, has been hot for Chinese start-ups.[Photo/CFP]

BEIJING - China's economy has enormous potential, and new growth engines are taking shape thanks to reform and pro-growth measures, a senior economist said Saturday.

The Chinese economy is faced with significant downward pressure and a complex economic environment both in China and abroad, Li Wei, head of the Development Research Center of the State Council, a top government think tank, told a forum in Beijing.

Deepening reform measures carried out in the past two years are delivering benefits and unleashing development momentum for the economy, Li said.

In the meantime, entrepreneurship and innovation have unlocked people's creativity and entrepreneurial passion, which are becoming an engine to power economic growth, he said.

China has a labor force of 900 million and over 7 million college graduates every year, with a growing number becoming entrepreneurs and joining innovation industries.

Li also said China is undergoing new types of industrialization, urbanization and agricultural modernization, which all serve to generate strong domestic demand.

The Chinese economy, which had a gross domestic product of 10 trillion U.S. dollars in 2014, is slowing down to what is officially called the "new normal."

The government has rolled out a raft of bold reform measures and pro-growth policies, aiming to relieve the downward pressure.

In a speech at Summer Davos in the port city of Dalian on Thursday, Premier Li Keqiang said China's new economic growth areas are rapidly taking shape and China's economic structure is quickly improving.

The service sector already accounts for half of China's GDP, and consumption contributes 60 percent to growth. Consumer demand for information, cultural and health products, and tourism are booming, the premier said.