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Follow us on TWITTER: http://twitter.com/cnforbiddennews Like us on FACEBOOK: http://www.facebook.com/chinaforbiddennews Official China data indicates that manufacturing and non-manufacturing business activity has declined. Economists highlight that after 30 years of policies for reform and opening up, China has now stepped away from the period of insufficient goods. Most product and manufacturing sectors are now relatively saturated. It is suggested that only by turning into a true market economy can new growth be found. China's National Bureau of Statistics (NBS) and Federation of Logistics & Purchasing has issued reports about manufacturing and non-manufacturing sectors status. The report shows that China's Purchasing Managers' Index (PMI) was down to 50.5% in January this year. This is compared with December 2013 at 51%, and last Novembers PMI at 51.4% Official figures show a non-manufacturing PMI drop to 53.4%. This is the lowest since February 2012, and a drop from 54.6% in December. A PMI reading above 50% indicates expansion, while a reading below 50% reflects contraction. Duan Shaoyi, Assistant Director, Beijing Unirule Institution of Economics says that this PMI indicates that China's economy may now enter a lonfg recession period. The data also shows that over the past year, China's economic growth has been greatly affected. Duan Shaoyi: "China has opened up reforms. Economically, the market used to be insufficient in available goods. This is because of serious shortages of products over the past 20 years, and was short of everything at the time. Whatever goods were produced, someone would buy them. Now the market has become more mature, so it needs to follow new economic rules. It needs to find new economic growth points, and only with this, can China's economy continue to rise." Duan says that China should develop new market needs. It should continue further reforms, which can then stimulate economic growth. Duan uses the example of Steve Jobs, and Apple's creation of the iPhone. The mobile phone industry went through a revolution, and this sector achieved a huge economic growth. Duan Shaoyi: "However, in China, in order to achieve further economic growth, the government first needs to reduce intervention. Particularly, it needs to reduce subsidies to enterprises. The government shouldn't always use taxpayer's money to run businesses. The government also needs to give entrepreneurs greater freedoms. It needs to enable them to follow the rule of a market economy, to be able to allocate resources. By doing this, the economy can continue to grow." The manufacturing PMI also has sub-indices. These include indices for new orders, production, employment, vendor deliveries, and raw material stocks. Australia and New Zealand (ANZ) Bank says that China's PMI dropped in January. This is thought to be mainly because of the affect by Chinese New Year. Manufacturing sectors started bank holidays ahead of January 31, Chinese New Year's day. All employees returned to their homes to celebrate. Duan Shaoyi believes that the Chinese New Year is only one of the reasons that production has been affected. It should not be the main reason that causes manufacturing PMI to drop. Duan Shaoyi: "Actually enterprises aim to make profit. If they receive a large order, and high demand for products, most enterprises will work extra hours. Employees work for money. If there is a chance to earn more, people will go for it. As long as it can make some profits, factories will not close on bank holidays." On January 30, HSBC bank announced that China's manufacturing sector shrank in January. The PMI was 49.5%, hitting a six-month low. Sources say that HSBC's survey focused on small and medium sized enterprises. China's official PMI includes larger state-owned enterprises. On January 31, Reuters reported that the PMI's dropping reinforces concerns: "as global investors already nervous about capital flight in emerging markets, find another reason to sell riskier assets." "Emerging market stocks and currencies were sold off in the past week... investors cut financial bets in developing nations, in anticipation that the US will continue to move to less easy monetary policy." said Reuters. China's NBS announced in January that in 2013, China's GDP rose 7.7%. It shows that the economic growth has been at it's slowest in 10 years. ANZ economists indicated in a report that, "we expect China's first-quarter economic growth to show a certain degree of slowdown." "China should lower its annual economic growth target to 7%." 《神韵》2014世界巡演新亮点 http://www.ShenYunPerformingArts.org/