Economic Work Conference to be held

By Wang Xinyuan Source:Global Times Published: 2012-12-14 0:10:04

The most important economic meeting of the world's second largest economy may be convened this weekend according to a report published Thursday, and economists estimated that next year's GDP growth target will remain unchanged from this year.

The Central Economic Work Conference may be held during the weekend, the West China City Daily reported Thursday, citing sources with knowledge of the matter. Last year, the conference was held between December 12 and 14.

The keywords for next year are "healthy development" instead of the "steady development" set for this year, the paper said, citing the press release from the recent meeting of the Political Bureau of the CPC Central Committee, which was believed to have set the tone for the coming conference.

The change of the keywords indicates that policymakers will pay more attention to economic restructuring and efficiency rather than the pace of growth, China Business News reported Thursday citing Lu Zhengwei, chief economist of Shanghai-based Industrial Bank.

There has been debate in policy circles as to whether the growth target should be kept, or lowered to 7 percent, according to a report e-mailed to the Global Times Thursday by Nomura China.

"The GDP growth target may be kept unchanged at 7.5 percent for 2013," Zhang Zhiwei, chief economist of Nomura China, said in the report.

"If the target is set at 7.5 percent, the risk of higher inflation in 2013 rises as the government may choose to tolerate higher inflation in exchange for higher growth," Zhang said.

A 7.5 percent GDP growth target for 2013 would be consistent with the government's ambition to double both GDP and income per capita by 2020 from 2010, Niu Li, a senior economist with the State Information Center, a government think-tank, told the Global Times Thursday.

Though the target seems high, it will be increasingly difficult to maintain such high growth in the coming years, said Niu.

China will most likely maintain a proactive fiscal policy and steady monetary policy for next year, Niu noted, as well as expanding the pilot program for value-added tax reform to replace business tax, and continuing tax cut measures in order to alleviate the tax burden of small and medium-sized enterprises.

The conference is expected to give some indication of the policy stance on reforms and the property sector, Zhang of Nomura noted.

Policy for the property sector is a topic of particular interest, as home prices have started to rise in many cities and may continue to grow if monetary policy remains loose, he said.

The government may again face the dilemma of how to maintain growth while containing property prices in 2013, according to Zhang.

Based on the requirements decided at the conference, the ministries and commissions will hold conferences and set their own targets, the West China City Daily reported.

There may also be changes in the positions of some high-ranking personnel, such as Lou Jiwei, chairman and CEO of China Investment Corp, Xiao Gang, chairman of Bank of China, Shang Fulin, chairman of China Banking Regulatory Commission, and Guo Shuqing, chairman of China Securities Regulatory Commission, the paper said.

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