Boosting domestic demand a long-term strategy: Chinese Premier

21:41, October 28, 2010      

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China takes domestic demand expansion, especially household consumption, as a long-term strategy to maintain healthy and stable economic development and transform the economic development pattern, Premier Wen Jiabao said.

In an explanation of a proposal on formulating the country's development roadmap over the next five years that was issued Thursday, Wen said that China needs to fully tap domestic consumption potential and break down systematic barriers that hindered domestic demand expansion.

The Communist Party of China (CPC) Central Committee's Proposal on Formulating the 12th Five-year Program (2011-2015) on National Economic and Social Development was issued Wednesday after it was adopted at the Fifth Plenary Session of the 17th CPC Central Committee which ended Oct. 18.

Wen made the explanation on Oct. 15 when the CPC Central Committee session began.

China should establish a long-term mechanism to boost domestic consumption to turn potential demand into actual buying power in the next five years, he said.

To establish such a mechanism, China needs to put further efforts in promoting urbanization, improving the income distribution system, expanding coverage of the social security network, improving basic public services, and upgrading the consumption structure, he said.

China should also optimize its investment structure, since the country is facing both increasing investment demand and overcapacity issues in some sectors while witnessing rapid industrialization and urbanization, he said.

More attention should be paid to the development of China's modern industries, so as to improve the quality of China's economic growth and enhance its competitiveness, he added.

China should continue the transformation and upgrading of the manufacturing sector, as it is still at a low industrial level and structural improvement is urgently needed, Wen said.

China should also develop the new strategic industries and accelerate the growth of the service sector, he said, noting that further development in the country's service sector could play an important role in boosting domestic demand and creating more jobs.



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