Photo: iStock
The report suggests that current financial support and tax reduction policies should focus on crowding out ineffective and inefficient investments. Photo: iStock

For the first time ever, China has released a new indicator measuring the value added output of its “new economy,” recording 12.96 trillion yuan (US$1.87 trillion) in 2017, the 21st Century Business Herald reported.

The latter contributed 15.7% to the total GDP, growing at an annual rate of 14.1% amid the slowdown of the Chinese economy, data released by National Bureau of Statistics (NBS) showed.

“New economy” shares of the primary, secondary and tertiary sectors contributed 0.7%, 6.6% and 8.4% to GDP last year, respectively.

The so-called “new economy” refers to new industries that have applied new scientific and technological outcomes and new forms of commercial activities derived from existing sectors and new business models, according to the interpretation of the NBS.

Dr. Liu Xueliang, director at the Macroeconomic Research Office of Chinese Academy of Social Sciences, believes the current slowdown is mainly due to the slow development of traditional sectors which account for a great proportion of the economy.

However, there is huge room for the future development of China’s new economy, such as the rapid expansion of online sales.