Unleash the power of consumption
- Source: Global Times
- [02:05 December 09 2009]
- Comments
No one would loosen their purse strings unless they have had a substantial income raise. Three decades of rapid growth has enabled the government to accumulate enormous wealth. Now, it is imperative to let ordinary people, the creators of this wealth, to share the benefits of growth.
In that sense, the decision of the just-concluded Central Economic Working Conference to adjust the income distribution system next year is long overdue.
There is unanimous agreement that China's economic future is dependent on more internal consumption.
But unlocking the power of consumption goes beyond sending cheap home appliances to the countryside or giving out vouchers to local residents. The key is the ability to increase individual income consistently.
When other countries embark on restructuring their economies with an eye on long-term recovery and prosperity – including to save more, spend less and sharpen competitiveness – it means that China's advantages of low price, cheap labor and resource would be seriously challenged.
Higher exports and more infrastructure development are no longer enough to boost China's economic growth. What is required is to make domestic consumption a growth engine. To realize it is a truly formidable challenge.
