Sharp increase in China's imports benefits world

09:45, March 31, 2010      

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The world economy is now showing an upward trend and China will continue to lead to world in economic recovery, according to data on the world's major economies released by the Organization for Economic Co-operation and Development (OECD) on March 5.

Engine of the world economy

The continuous upward trend of China's economy, huge domestic market and low customs duties have given a push to the sharp increase in China's imports and have greatly benefited neighboring countries.

In January and February of this year, nearly 44,000 tons of fruits worth around 50 million U.S. dollars from ASEAN member countries were imported into China via Shenzhen Customs, up almost 21 percent and 39 percent compared to the same periods of last year. Yao Jian, spokesperson for the Ministry of Commerce (MOFCOM) pointed out on March 16 that the goods China imported from the six ASEAN member countries is much more than the goods China has exported to them since the establishment of the ASEAN Free Trade Area on Jan. 1, 2010.

Countries in other parts of the world have also benefited from China. Data released by the National Bureau of Statistics (NBS) shows that China's import value for February reached nearly 87 billion U.S. dollars, up nearly 45 percent, propping up the recovery of the world economy.

Yao added that for many countries, China has now become an important export market. In 2009, China was the largest export market for Japan, Australia, South Korea, the ASEAN member countries, Brazil and South Africa, as well as the third largest export market for the United States, the EU and India. The proportion of the export value which the above-mentioned countries reaped from China to the total export value of these countries increased at different paces in 2009.

"This shows that the stimulus package which the Chinese government adopted to handle the international financial crisis and to promote rapid and smooth economic growth has not only benefited China's economy, but also played an important role in helping the world economy recover. China has become the engine of the global economy," Yao said.

Klaus Schwab, president of the World Economic Forum, said that the rapid growth of China's economy has played a vital role in the current world economic environment. "China's economy will grow rapidly even if the world economy slows down, and China will become a major driving force behind the world economy."

The "new normal" - changes and opportunities

The global economy is entering an era of the "new normal" after the financial crisis. The "New normal" features the further drop of potential growth rates, adjustments of economic structures, transformation economic growth modes, rebalancing the global economy, restrictions on financial globalization, more attention to the industrial development and even the revival of "reindustrialization," said Zhang Xiaojing, director of the Macro Economic Research Institute under the Chinese Academy of Social Sciences.

The Chinese government is taking timely and strong macroeconomic control measures to recover from the financial crisis. China's GDP rose by almost 9 percent in 2009, exceeding the benchmark of ensuring at least 8 percent of GDP growth.

"In 2010, the government should continue to consolidate the achievements of macroeconomic control in order to maintain stable and rapid economic growth and also be alert to the possible inflation," said Jin Mengqin, an associate professor from the Department of National Economic Management at Renmin University. "Moreover, the country should pay much more attention to economic structural adjustments."

So how do we maintain rapid economic growth in 2010? The answer is self-evident now that it is the right time for China to transform its economic growth mode.

Priority for transforming the development mode

China's retail sales of consumer goods totaled 2.5 trillion yuan in the first two months of 2010, an increase of 18 percent from the previous year. The growth rate was 2.7 percentage points higher than that in the same period of the previous year, and 2.4 percentage points higher than that in the entire previous year, according to the newest statistics from the NBS. China already has the economic foundation to transform the economic development mode after becoming a major importer.

"To maintain a sustained and stable growth in consumer demand, it is essential to enhance the incomes of ordinary people. After taking the first step of making the people more wealthy, government policies should also give attention to the investment in medical care, education and social security systems in order to alleviate their economic burdens, which is a fundamental way to boost consumption and return wealth to the people," said Li Yiping, a professor from the School of Economics under Renmin University.

Against the backdrop of a new round of adjustments in industrial structure, the worldwide competition in new energy has already started. Although China has achieved significant results in the development of the low-carbon industry represented by new energy, there is still a gap between itself and developed countries in key green technologies.

Huang Qili, an academician from the Chinese Academy of Engineering, stressed that renewable energy is not only the focus of China's energy strategy, but is a major force in implementing energy localization, clean energy and sustainable development strategies. It is necessary to actively support and guide the sound and rapid development of renewable energy by means such as technological advancement, policy guidance, market economy and management innovation, as well as by formulating pragmatic incentive policies under the principles of adjusting energy structure and reducing greenhouse gas emissions.

By People's Daily Online
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