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Experts Optimistic About China's Capacity for Growth
Experts attending the East Asia Economic Summit Tuesday expressed confidence in China's capacity for growth in the coming years, believing the country, which has spared the brunt of the world economic downturn, will be a engine of growth in the region.
With Japan's economy still gloomy, "China is becoming the biggest engine of growth for Asia,"said Georges Ugeux, group executive vice president of New Stock Exchange, who was also chairman of the a panel discussion entitled "China: Enhancing the Capacity for Growth."
With China's imminent entry into the World Trade Organization, its winning of the hostship of the 2008 Olympics and the successful holding of this years APEC summit, "China is now a center-stage power not just politically but economically,"said Ugeux.
Gordon Orr, managing director of Mckinsey & Company in China, said China's development in the past years is basically sound. "Consumer spending and confidence in China is high. Wealth and spending power are rising in China's smaller cities, and spending on public works is further boosting demand," he said.
He also noted that the quality of infrastructure in China, particularly telecommunications, is high. Multinationals and other investors are continuing to relocate their manufacturing facilities to China, including production of high-value added goods, he said.
He stressed China's advantage in human capital, citing that China's universities are now turning out twice as many computer science graduates as India, luring more international firms to establish their major research facilities in China.
Many Western-educated Chinese with experience working at multinational companies are choosing to return home to seek new opportunities, particularly with the downturn in the United Sates, Orr said.
Local Chinese companies in every sector are also restructuring to meet the demands of a more competitive, post-WTO accession environment, Orr added, noting all the above-mentioned conditions are the driving factors for China to maintain its capacity for growth in the future.
China is targeting an annual growth rate of 7 percent for the next five years, thanks to the government's stable and sound
financial measures, the country's vast domestic market the opportunities brought about by its pending WTO entry, according to Shi Guangsheng, China's minister of Foreign Trade and Economic Cooperation.
Andy Xie Guozhong, managing director of Morgan Stanley Asia, agreed that the Chinese economy could afford to grow at 10 percent, given its higher efficiency. This could be achieved with improvements in the efficiency of the financial sector, he said.
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