Commentary: Balancing growth and reform, Chinese model can succeed
                 English.news.cn | 2014-03-04 17:30:28 | Editor: Bi Mingxin

By Xinhua Writer Cheng Jing

BEIJING, March 4 (Xinhua) -- For the past decades, China's rise on the world stage has been watched with much skepticism. Even after its stellar growth has lifted hundreds of millions of people from poverty, distrust still runs deep.

As China's economy comes to yet another juncture where the tradeoff between growth and reform seems inevitable, opinions on its outlook are once again polarized.

Amid both cheers and doubts, China's leadership is set to announce the growth target for 2014 at the coming parliamentary session, with most analysts expecting it to stay unchanged at 7.5 percent.

If so, this would be the third consecutive year for the world's second-largest economy to target 7.5-percent growth after the country tuned down the goal in 2012 from 8 percent set for the previous eight years.

Despite much outside worry, Chinese leaders have on many occasions repeated their confidence in steering the economy onto a more balanced path while securing sound growth to create enough jobs.

Their optimism is well founded, on a few fronts.

China's market of over a billion consumers and growth potential arising from urbanization have been discussed too much. A more potent force that the country can always count on is its unique "Chinese Model" that keeps evolving to suit the national conditions.

After decades of single-minded pursuit of growth to generate wealth for the poor with little regard to its adverse impact, China has started to put focus on quality of development as the skies are growing more polluted and resources reaching their limit.

The new mindset of seeking balanced development has served the country well in recent years: stable growth, a steady job market, mild inflation, and more importantly, a cozy environment for reforms.

The central government has taken steps to boost consumption, delegate power to lower levels, remove its grip on lending rates and set up a free trade zone in Shanghai to pilot financial reforms, all of which has put the economy on an even footing.

The effects have already begun to spread. China's service sector, in terms of its shares of GDP growth, outperformed the industrial sector for the first time last year after years of emphasis on restructuring.

Like most reforms in the past, this round of moves directs from top to bottom. For fear of its message getting watered down at local levels, the central government has made sweeping changes to its official assessment system to demonstrate its resolve to ditch the growth-at-all-costs model.

Market vigor has also come from unexpected quarters. The booming Internet finance sector, led by e-commerce giant Alibaba, is staging a "China-style creative destruction" in the financial industry that could accelerate reforms in the area.

As 2014 is the first year for the government to deliver its wide-ranging reforms promised during the Third Plenum of the 18th Central Committee of the Communist Party of China, more structural and social changes are widely expected, though possibly that will come at a greater cost.

But the policymakers' determination is not to be underestimated.

They have already started to confront the country's economic problems. In a tone-setting economic conference late last year, the government highlighted mounting local government debts and overcapacity, two areas deemed to be major threats to national economic health, as work priorities for 2014.

As long as China's reform resolve keeps on track, the country is set to open a new chapter of its growth stories that is to the benefit of both itself and the world.

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