Illustration: Luo Xuan/GT

Liu Shijin, deputy head of the economic committee of the 13th Chinese People's Political Consultative Conference National Committee

There are two basic facts that people should realize about the Chinese economy. The first is that the transfer from high-speed growth to the gradual decline was due to a shift in economic growth phases - from 10 percent high-speed growth to 5 percent medium-speed growth. 

The second basic fact is that monetary and fiscal policies will not change the potential growth rate. There have been voices calling for looser monetary policy. In fact, monetary policy has already become relatively loose in recent years. 

As the current macroeconomic policy is relatively loose, adopting a stimulus policy or trying to beat the potential growth rate is like advance spending. Economic stimulus could trigger a steep drop, and China should be particularly wary of this possible outcome.

The Chinese economy has entered a medium-speed growth phase, which has a 5 to 6 percent GDP growth rate but it has not been stabilized. It could still fall by 1 percentage point in the next year or two. The pressure to maintain stable economic growth will be greater next year. 

Old driving forces for growth - infrastructure, real estate and exports - have been lacking momentum. The Chinese economy has to look for new potential thrusts for medium-speed growth if it wants to prevent a drop below 5 percent. Therefore, next year's focus should be on reforms and policy adjustment.