Chinese economy growing into maturity
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People's Daily, January 20, 2012
China’s GDP growth rate of 9.2 percent in 2011 marks a sound beginning of the 12th Five-Year Plan period (2011-2015). The government-led investment boom did not occur last year, indicating in some sense that the country's macro-economy is maturing.
At present, the country remains in a long period of rapid economic growth, and a GDP growth rate of around 9 percent is normal and reasonable. Overly rapid economic growth may cause inflation, while slow economic growth is not conducive to absorbing a growing rural labor force.
The European sovereign debt crisis was mainly caused by European countries' overspending practices. The pace of China's economic development has only a limited role in helping resolving the debt crisis, unless China greatly increases its imports from or investments in Europe. The recession caused by the debt crisis has marked adverse effects on China's exports. In other words, if the European debt crisis remains unresolved, China's export and GDP growth will continue to slow down this year.
China's trade surplus dropped in 2011, indicating net exports' role in boosting the country's economic growth is weakening. Investment remains the main driving force for China's economic growth, and the role of consumption needs to be further enhanced.
For a long time to come, urbanization and reforms of the social structure and people's income structure will play a fundamental role in boosting domestic consumption and improving people's purchasing power. Furthermore, the services industry will play a vital role in boosting domestic consumption.
This year, the fiscal policy for improving people's livelihood as well as the projected accelerated development of China's central and western regions will promote the country's economic growth to a certain degree. Overall, the country's GDP growth in 2012 will be largely the same as that of last year.
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