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BEIJING (MNI) - China's top economic priority next year is keeping the
economy stable, preventing slowing growth from becoming the norm and ensuring
the targets under the 13th five-year plan are smoothly achieved, a senior policy
advisor said on Sunday.
While the economy registered some slowdowns in the first three quarters
this year, it will continue to expand in the longer term due to a large
population that sustains demand, said Yang Weimin, a deputy director of the
economic committee of the Chinese People's Political Consultative Conference.
"The so-called principles or theories derived from other countries'
development, such as the Middle Income Trap known to everyone, I don't think
these concepts apply to China," Yang said. Most of the mid-income countries that
experienced stalled growths had populations of 100 million at the most, while
China's is more than 10 times bigger, he said.
Here are other takeaways of Yang's speech at the Jinjialing Wealth
Management Forum held by China Finance 40 Forum in Qingdao city of Shandong
- Consumption growth has been hindered by high levels of household debt.
Spending accounts for 66.5% of urban resident incomes in 2018, down from 69.8%
in 2013, Yang said.
- While the level of consumption of some industrial products, such as coal,
has peaked, demand for other industrial goods, such as auto, has more room to
grow given China's per capita car ownership is still below that of developed
economies. Demand for steel rebar and wire products is also growing given the
urban infrastructure needs spurred by 200 million rural migrants settling in
cities and 8 million university graduates each year.
- It is important to balance risks prevention and supporting the real
economy. Policymakers should reduce financing costs further next year to boost
companies' returns on investment and ease pressure of mortgage repayments, even
if doing so reduces profits of lenders.
- China must enhance the system rooting out inefficient SOEs, or the
so-called the zombie companies, in an orderly, market-based and law-based way.
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