Post date: Feb 27, 2012 2:31:56 PM
China-World Bank/2030 Report -- WB advices China to complete market-economy transition
CCTV BEIJING - China should complete its transition to a market economy in order to achieve its goal of becoming a high-income society, according to a report jointly issued by the Chinese government and the World Bank.
The report, "China 2030: Building a Modern, Harmonious, and Creative High-Income Society" was issued Monday by the World Bank and the Development Research Center of the State Council in Beijing.
The report says China should carry out enterprise, land, labor and financial reforms as part of its efforts to create a new structure for economic growth.
It also says China needs to strengthen its private sector, open its markets in order to foster competition and innovation, and ensure equality of opportunity to achieve its goals.
The assessment warns of possible risks faced by China over the next 20 years. It says China also faces challenges posed by an aging and shrinking workforce, rising inequality, environmental stress, and external imbalances.
"Urbanization is projected to go from 50 to 70 percent. Within the next five years you'll have more people leaving the work force than entering in it. And there are concerns about inequality and an urban-rural divide. And in how China, as a growing economy, as it grows larger, fits effectively in the global system," said World Bank Group President Robert B. Zoellick.
The report also suggests the establishment of a link between China's structural reform and the changes in international economy, so as to build a mutual beneficial and win-win relation with the globe.
"In trade and international economic relations, this is the case with the US and China, with Europe and China. The disputes have become somewhat of a zero-sum traditional trade off. For creative officials, in China as well as in other countries, this report actually offers some additional opportunities for win-win mutual gains. For example, look at the ideas here about opening up the service sector to build productivity and jobs, that can help international firms to be able to compete, but also gain business in China," said Zoellick.
Chinese policymakers should also shift from focusing only on the amount of growth to focusing on the quality of growth as well, says the report.
The Chinese economy slowed down a little bit in recent months. As for whether a significant downturn could be foreseen, Zoellick said he would expect a soft landing.
"And also in the near term I personally believe that China is likely to have a soft landing. So the traditional model is based on export net growth and heavy investment," Zoellick added.
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