Chinese leaders' goals rational and realistic

Updated: 2012-12-19 11:06

By Zhang Yuwei in New York (China Daily)

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The goals outlined by China's new leadership at a national economic conference in Beijing over the weekend are realistic and rational, according to experts in the United States.

They said the Central Economic Work Conference set the tone for the country's economic policies in coming years, noting the new leadership's plans to ensure China enjoys long-term and high-quality economic growth.

"It seems that China will concentrate on the quality of its growth instead of numerical growth of its GDP," said Zhu Zhiqun, a professor of political science at Bucknell University in Pennsylvania.

"China has reached the stage at which having high-quality growth is more desirable than having fast growth."

China's economy grew 7.4 percent in the third quarter, down 0.2 of a percentage point from the previous quarter. Most experts predict the rate will be 7.5 percent for this year, the lowest recorded since 2004.

Robert Berring, a professor with the School of Law at the University of California, Berkeley, said China's leadership is saying all the right things.

"China will stay on the right track if these goals are ardently pursued," Berring said. "China has matured into a world economic colossus. Now it is time to make sure that the colossus has a strong foundation."

Theodore H. Moran, a senior fellow at the Peterson Institute for International Economics in the US capital of Washington, said growth will also be needed from the private sector.

"From an outsider's perspective, one might have hoped that there would be high priority given to private-sector growth within China, while shifting away from State-owned enterprises," Moran said.

The conference also touched on issues such as consumer spending - which many believe is the best foundation for growth - and the need to increase private investment and spend more public money on infrastructure projects.

The new leadership's fiscal policies will concentrate on tax reforms, structural tax reductions, and stricter controls on administrative spending.

Zhu, from Bucknell, said: "To stimulate domestic spending is critical as China transforms its economic model from export-oriented growth to consumption-based development.

"This will also be helpful to the global economy, as China is likely to import more consumer products, which in turn will contribute to job creation in other countries."

The new leadership said it will keep in place controls that constrain speculative housing purchases.

The conference caught the attention of leading economists around the world largely because it was the first to be held since the change in China's leadership.

"The new leadership is well informed and seems committed," said Michael Spence, a Nobel laureate in economics and a professor at the Stern School of Business at New York University.

"I still think the structural changes will be the hardest to accomplish," Spence said. "But, generally, I would be optimistic."

Chen Weihua in Washington and Chen Jia in San Francisco contributed to this story.

yuweizhang@chinadailyusa.com