How can China enhance growth quality?
Updated: 2012-12-20 14:10
BEIJING - Experts say China's economic policies in the next few years will center around promoting the quality and efficiency of its economic growth following a recent economic work meeting.
The government said enhancing the quality and efficiency of economic growth will be its central task, according to a statement released after a central economic work conference held last weekend.
Zhang Liqun, an analyst with the Development Research Center of the State Council, said Wednesday that China's future economy will rely on moderate growth that focuses on quality and efficiency.
"Although the economy still faces downward pressure this year, authorities have not taken drastic stimulus measures like those taken two years ago," Zhang said.
Instead, the government has pared its economic growth target down to 7.5 percent for the year. Due to flagging exports and domestic efforts to contain runaway property prices, China's annual economic growth slipped to 7.4 percent in the third quarter this year, slowing for seven quarters in a row.
To boost quality growth, expanding domestic demand will be the strategic basis for China's development next year, according to the statement.
New growth points should be created in domestic consumption, which will serve as both a strong pulling power and a foundation for the economy's sustained and healthy development, it said.
The statement also emphasized deepening the strategic transformation of China's industrial structure in order to realize high-quality, efficient and sustainable growth.
Yi Xianrong, a researcher with the Chinese Academy of Social Sciences, said quality economic growth means growth in real terms, which will require squeezing out asset bubbles.
"Gross domestic output should be based on the expansion of the real economy, instead of being pushed up by surging asset prices," Yi said.
Stubbornly high real estate prices have been a significant source of public complaints in recent years, forcing the government to implement a string of policies, including a ban on third-home purchases and property tax trials, to keep prices down.
However, the property market started to show signs of warming after the central bank cut interest rates and the reserve requirement ratio for banks twice earlier this year to buoy the economy.
The government reiterated at the central economic meeting that it will continue its property market control policies next year.
Yi said the government's property policies should foster clear expectations in the market to squeeze out speculative demand.
"Economic growth driven mainly by the property sector represents excessive consumption and an unsustainable growth pattern," Yi said.
Authorities also recognized the importance of urbanization during the economic meeting, as it is a main driver of domestic demand.
The country will center its efforts on improving the quality of urbanization and incorporating the concept of ecological civilization during the urbanization process to build intelligent, green and low-carbon cities, according to the statement.
"Authorities consider urbanization to be a major source for enhancing growth quality and efficiency," Yi said.
Urbanization will unleash great potential for expanding domestic demand, as it will promote both investment and consumption, he said.
The country's urban population, which outnumbered that of rural areas for the first time at the end of last year, is expected to account for 70 percent of the total population by 2030, according to a World Bank forecast.