A year of rebalancing

Updated: 2012-01-18 08:02

(China Daily)

  Print Mail Large Medium  Small 分享按钮 0

The resilient growth of the Chinese economy in 2011 should not be that surprising given the formidable momentum produced by the country's accelerating urbanization.

Instead, what impresses us most about the past year is the early and vital progress China has achieved in rebalancing its economy domestically and internationally.

The latest statistics show that the world's second largest economy expanded by 9.2 percent last year in spite of the global turbulence and domestic price hikes.

Compared to its own record of more than three decades of nearly double-digit growth, the new growth figure does not look too exciting. Yet, from a global perspective, the performance of the Chinese economy remains the envy of most developed countries, which are plagued by sovereign debt crises and stubbornly high employment.

Chinese policymakers certainly deserve credit for their resolute efforts to battle surging inflation. The country's consumer inflation hit a 37-month high of 6.5 percent last July before it was brought down to 4.1 percent in December.

Those people who expressed concern that China's tightening measures to fight inflation would lead to a drastic slowdown surely did not expect 9.2-percent overall growth.

They underestimated the long-term driving force that the country's ongoing urbanization provides.

More importantly, they failed to grasp the far-reaching significance of China's progress in rebalancing its growth pattern.

The country is reducing its dependence on external demand and boosting domestic consumption as a key engine for sustainable growth. China's trade surplus fell to $155 billion last year, down 14.5 percent from a year earlier, falling to an estimated 2.2 percent of GDP in 2011, compared with 3.1 percent in 2010 and a high of 7.5 percent in 2007.

The country has also managed to, slightly but steadily, rein in the widening income gap between rural and urban residents, one of the most difficult problems that the country must overcome to sustain its long-term growth story.

It is particularly reassuring to see that the nominal income growth of rural residents increased by 17.9 percent, outpacing that of urban residents, to narrow the urban-rural income ratio from 3.23:1 in 2010 to 3.13:1 in 2011.

The scale of China's rebalancing may appear small in terms of statistics. But in reality, it could mean a sea change in many aspects of our social and economic development.

(China Daily 01/18/2012 page8)

8.03K