China needs entity economy to boost GDP: expert
By Shan Xin (
People's Daily) 10:52, January 05, 2018
Zheng Yongnian, professor and director of the East Asian Institute at the National University of Singapore
Beijing (People's Daily app)-China must rely on the real economy to drive growth of gross domestic product (GDP) per capita, said Professor Zheng Yongnian, director of East Asian Institute at the National University of Singapore, in an interview with the Xinhua News Agency on Wednesday.
According to Zheng, technical innovation and institutional reform are critical to a booming real economy. An industrial upgrade from quantitative to quality-oriented is also expected to help Chinese financial markets better serve the real economy.
To highlight its importance, Zheng offered an example of the 2008 financial crisis, which was mainly caused by Western countries’ underestimating the real economy after trying to “kidnap” it, he said.
Zheng also noted that poverty alleviation policies would help decrease the number of rural people in absolute poverty in China and promote social stability. This would positively impact other countries amid China’s pivotal worldwide influence.
“Many countries in Latin America, Africa and Asia are greatly interested in China’s economic development model and hope to learn from it”, Zheng said.
http://en.people.cn/n3/2018/0105/c90000-9312069.html
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China is still a developing country with smaller per capita GDP than many others. Hence, it will take time till it reaches a meaningful level of comprehensive development.
Just to cut the crappy idiotic imbecile "China's economic growth relies on exports, ho, ho, ho!" argument:
China's exports continue to grow but the share of exports in total economy is declining, which means that consumption is taking over as an engine of growth.
Of course, this does not mean manufacturing will disappear, it is simply transitioning to high value-added. Because, without manufacturing, consumption-based growth will mean national account deficits because of import dependency.
The US (and SP12) can tolerate such kind of manufacture-less growth. But, as an East Asian developmental state, it is just contrary to the economic DNA of China.
China will have strong manufacturing and industrial base, and will keep exporting value-added products, but, it also reinforces domestic consumption that is mostly based on domestic production.
Hence, China has almost the good of everything:
1. Positive national account
2. Strong manufacturing base
3. Ever growing domestic consumption
4. Domestic production-based consumption leading to the emergence of national champions (because capturing a certain portion of China market means one has already become a billion-dollar company
