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Commentary: Doomsday prophets misread Chinese economy

English.news.cn   2014-02-26 14:22:19

 

By Xinhua writer Zhu Dongyang

BEIJING, Feb. 26 (Xinhua) -- Recent official data showed that the Chinese economy grew 7.7 percent last year, relatively slower compared with the two-digit rates that the country has recorded for almost 30 years.

The slow-down has again aroused concerns and market jitters, with some skeptics claiming that China's economic boom is over and a hard landing is inevitable.

The doomsters, however, missed the whole picture of the Chinese economy and over-estimated the risks while focusing their attention on digits.

For one thing, China's current growth rate, though slower than that in the previous years, still leads other economies.

For another, the slow-down is an expected result of the Chinese government's new strategy to seek quality-oriented and environment-friendly growth.

Official data shows that consumption has caught up with investment to become an equally important driving force of China's economic growth, a sign of initial success of China's restructuring efforts.

Boosting domestic consumption has been China's long-term goal to improve economic sustainability. The government has taken steps such as increasing public spending on health care and pension to strengthen the people's ability of purchase.

Last but not the least, income gap between rural and urban areas has been narrowing, an enticing result of the massive push for urbanization. Tens of millions of Chinese farmers, the largest but long laggard consumer group in the country, are becoming able and ready shoppers, which will unleash massive consuming power for both China and the whole world.

China, once contributing to 50 percent of the world's growth in 2009 and 2010, has been a powerful helping hand in dragging the world economy out of the years-long crisis starting in 2008.

However, the Chinese government has been well aware that the country's rapid growth has been proved unsustainable as it was achieved at the cost of resources scarcity, air pollution and excess productivity.

Thanks to its unremitting efforts on economic reform and urbanization drive, the manufacturing proportion in China's economic fundamentals will further decline. Its sustainable development will increasingly depend on high-quality growth, featured by lower inflation and more mobility in the labor market.

"We know the world holds high expectations on China; however, it's unreasonable to demand China contribute to half of the global growth as it did, considering its economy only accounts for less than 10 percent of that of the globe," Chinese Finance Minister Lou Jiwei said in Sydney, Australia this weekend when attending G20 meetings.

Time and again over the past years, China heard warnings on its economic over-heating or hurly-burly about possible recession. Nevertheless, with a dynamic and tenacious economic performance, the world's second largest economy proved that they were all wrong.

This time, the pessimist predictors are set to be disappointed again, as they failed to see the fundamentals of the Chinese economy, and the government's capability and resolve to push reforms.

By stirring up turbulence on the markets, doomsday prophets will do no good to anybody. After all, a steadier and healthier Chinese economy also serves the best interests of the world.

Related:

Commentary: China's booming consumption is a boon for global growth

BEIJING, Feb. 27 (Xinhua) -- Recently released official data showed that the tertiary sector made up 46.1 percent of China's GDP in 2013, outperforming the secondary sector for the first time.

The historic shift results from the Chinese government's active efforts in economic restructuring, and heralds further upgrading of China's consumption structure. Full story

Voices of the world: Who will benefit from China's further open economy?

BEIJING, March 3 (Xinhua) -- The notion of building a new open economic system, including easing investment access, accelerating the construction of free trade zones and further opening up inland and border areas, has been clearly brought up at last year's third plenum of the 18th Central Committee of the Communist Party of China.

It is expected that the ongoing "two sessions" -- the annual sessions of the National People's Congress (NPC) and the National Committee of Chinese People's Political Consultative Conference (CPPCC) -- will keep deploying and implementing the open economic policies. Full story

 

 

Editor: Bi Mingxin
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