China is the world's second largest economy, contributing more than 30 percent to world economic growth on an annual basis.

What is the trend of China's economy? Are house prices going up or down? What other industries need to cut capacity? Can private investment continue to pick up? Has foreign capital been pouring out of China? Is RMB exchange rate fluctuation normal? These domestic and international concerns about China's economic hot spots can be found in the government work report submitted to the National People's Congress for deliberation on Friday.

What about the economy?

From 10.6% economic growth in 2010 to 6.9% in 2015 and 6.7% in 2016, China's economy has gradually stabilized in slow decline. How has China's economy fared in 2017?

According to the government work report, China's GDP will grow by around 6.5 percent this year.

"According to various indicators, there are clear signs that the economy is bottoming out in stages." Zhang xiaoqiang, a member of the national committee of the Chinese people's political consultative conference (CPPCC) and former vice chairman of the national development and reform commission, said it is more important for the economy to improve its quality and increase its efficiency, and for the economy to gain momentum.

Some leading indicators have continued to improve this year. In February, the manufacturing purchasing managers' index (PMI) was 51.6%, staying above 51% for five consecutive months. The producer price index rose 6.9 per cent in January from a year earlier, the fifth straight month of positive growth. Foreign trade data rebounded.

China will adhere to the general tone of seek improvement in stability work and put prevention and control of financial risks in a more important position. "This suggests that in the pursuit of more real growth, growth may not be very high, but entrepreneurs' expectations are more stable." "Said lu jianzhong, a member of the CPPCC national committee and chairman of the board of datangxi group.

The current internal and external situation facing the economy remains complex and grave. Bai chong 'en, a member of the CPPCC national committee and executive vice dean of the school of economics and management at tsinghua university, said: "the key to a growth rate of around 6.5 percent is to ensure employment, form good social expectations and pay more attention to improving the quality and efficiency of development on a stable basis."

Are house prices going up or down?

Last year, there was a marked divergence in the real estate market, with prices in first-tier hot cities such as Beijing, Shanghai, guangzhou and shenzhen and some second-tier cities rising rapidly. At the same time, the third - and fourth-tier cities are still under great destocking pressure. What will happen to house prices this year?

The government work report pointed out that at present, the real estate inventory in third-tier and fourth-tier cities is still large, and it is necessary to support the demand of residents to live by themselves and those who go to cities to buy houses. We will accelerate the establishment and improvement of a long-term mechanism for promoting steady and healthy development of the real estate market.

Since September last year, a number of hot cities have introduced intensive regulatory measures. According to the national bureau of statistics, prices of newly built commercial residential buildings in 11 of the 15 first-tier and second-tier hot cities fell month-on-month in January, while prices in Beijing, hangzhou and chengdu were flat and prices in guangzhou rose by 0.6 percent month on month.

Deputy to the National People's Congress, deputy director of the finance committee of the National People's Congress committee gu shengzu believes that this year the real estate market is facing "prevent overheating" and "inventory" double tasks, to speed up the establishment conforms to national conditions, to adapt to the market rule of basic system and a long-term mechanism, and stick to sorted guidance, because city ShiCe, for different regions and different cities in the land, the different in the finance and tax adjustment, is advantageous to the real estate market healthy and stable development.

What other industries will lose capacity?

In 2016, as the top five tasks of supply-side structural reform, the reduction of production capacity has made positive progress, but there have also been problems such as the sharp rise in the price of coal and steel in a short time, and the difficulty in eliminating outdated production capacity.

How will efforts to cut overcapacity be made this year? Will more industries be included in the scope of capacity reduction?

This year, the government will cut another 50 million tons of steel production capacity and cut coal production by more than 150 million tons, the government work report said. At the same time, we will phase out, halt or postpone the construction of coal and power plants with a capacity of more than 50 million kilowatts to prevent and defuse the risk of coal and power overcapacity.

"The report calls for more market-based and law-based approaches. This requires a coordinated plan that combines capacity reduction with structural adjustment, transformation and upgrading, and layout optimization to make progress more scientifically, accurately, and effectively." "Said koo.

Can private investment rebound?

In the first half of last year, private investment continued to slow down. Thanks to a series of policies, it started a four-month recovery in September last year. Will private investment firm up this year?

'policies and measures to promote private investment should be implemented and improved,' the report said. We will accelerate the improvement of the system for protecting property rights. We will stimulate and protect entrepreneurship, and enable entrepreneurs to operate and invest in peace of mind.

"I visited a lot of companies at the beginning of the year and found that they are doing well, especially in the logistics sector, where the volume of business has increased." Xu guanju, chairman of chuanhua group and a member of the CPPCC national committee, said that private capital is abundant now.

"The solid foundation for the recovery of private investment is not yet secure." Zhang xiaoji, a member of the national committee of the Chinese people's political consultative conference (CPPCC) and former head of the foreign economic research department at the development research center of the state council, said more openness should be made in related fields, such as encouraging private enterprises to participate in the reform of state-owned enterprises and share in mixed-ownership enterprises, so as to further reduce costs and ease the burden on enterprises.

"With the improvement of cyclical indicators such as profits and prices, as well as the implementation of supporting policies of the property right protection system, private investment confidence is stronger." Lu jianzhong said.

Will foreign capital flow out of China?

The report points out, optimize foreign investment environment energetically. China will open its door wider and continue to be the most attractive destination for foreign investment.

"China's economy has great potential and remains attractive to foreign investment." Zong qinghou, NPC deputy and chairman and general manager of wahaha group, said that optimizing the environment for foreign investment and attracting high-quality foreign investment can promote the new round of development of China's economy, especially the real economy.

Foreign investment in any country will go in and out with the change of economic development level and industrial structure. "China has gone from attracting capital to selecting it." Mr Zhang said foreign companies that focus on providing high-performance, high-quality products and services and value China's consumer market were better suited to invest in China.

Economist zhang yansheng says, new period attracts foreign capital to ought to have brand-new train of thought. The report proposes to build 11 pilot free trade zones with high standards and high standards to create a "institutional highland" for attracting investment. On the other hand, we should formulate a long-term plan for industrial development as soon as possible, promote industrial opening in a targeted and step-by-step manner, and enhance China's position in the global value chain.

Is RMB exchange rate fluctuation normal?

The report proposes to stick to the direction of market-oriented reform of the exchange rate and maintain the stable position of the RMB in the global monetary system.

The yuan edged up against the dollar in January. "The renminbi will not always depreciate unilaterally against the dollar, and two-way volatility is becoming the norm." Xie wei, a member of the national committee of the Chinese people's political consultative conference (CPPCC) and deputy general manager of bocom schroder fund co., believes that the U.S. dollar is difficult to maintain a constant strength, which will leave room for the adjustment of the RMB.

Yi gang, a member of the national committee of the Chinese people's political consultative conference and a deputy governor of the people's bank of China, said the yuan's exchange rate fluctuates smoothly compared with other convertible currencies. "China is a responsible big country. On the whole, our policy orientation is to keep the RMB basically stable within an appropriate range.

'it's normal to see fluctuations in the foreign exchange market, but these fluctuations are short-term and will eventually return to fundamentals,' said pan gongsheng, director of the state administration of foreign exchange and a member of the national committee of the Chinese people's political consultative conference. The foreign exchange market is stabilizing and the trend is becoming more and more obvious.

"With the supply-side structural reform, China's economic growth will be more efficient, the current account surplus, cross-border capital inflows will be stable, and the foreign exchange reserves will be very abundant. The foundation of the foreign exchange market will be very stable in the future." "Said pan.