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China's economy in adjustment
2013-04-02
Liu Shijin, vice-minister of the State Council's Development Research Center (DRC), said at the Linnan Forum, in the city of Guangzhou, Guangdong province, on March 31, that China's economy has been going through a period of adjustment in recent years and he expects it to have an annual growth of 7-8 percent, in two years.
Liu explained that China had high annual growth of more than 10 percent for many years and that it has hit a phase of modest growth. In 2012, its per capita income was above $9,000, with south coastal areas reaching an international level.
But, he went on "Even with an economic growth of 7 percent, China has not seen satisfactory development and a well-off society," then added, "Today's macroeconomic policies are to stabilize growth, prevent inflation and control risks."
He also explained possible new growth points, as follows: First, find new investors to develop infrastructure and basic industry, improve competition, and break up monopolies to attract outside investors; second, increase land reforms, improve household registration and urban financing to improve urbanization and productivity; third, improve industrial adjustments.
Liu said that the major issue in China's industrial upgrades is overcapacity and that the housing, infrastructure, iron and building materials industries have reached or will soon reach peak demand, and that industrial adjustment should mainly concern enterprises and markets, while the government should focus on a withdrawal mechanism for enterprises.
