China confident of continued economic growth
The Sydney News.Net
China's benchmark stock index the Shanghai Composite lost 5.2% of its value on Friday spooking global markets.
Saturday 13th November, 2010
Far from losing its shine however, the Chinese index fell only because inflation is rising with interest rates expected to follow - because of the booming state of the economy.
China in fact is set to grow at an annual average rate of 8% for many years to come, a leading Chinese government investment official said Friday.
But the country needs to carry out broad structural reforms to ensure that prosperity is shared by all, he said.
"China's growth strategy will not only be important for the country itself, but also for its neighbors, and for the rest of the world," Jin Liqun, Chairman of the Board of Supervisors of China Investment Corporation said in a presentation at the Asian Development Bank's (ADB) Eminent Speakers' Forum.
Jin said reforms which will help unlock the economy's full potential include greater focus on technology and quality in production, a higher skilled labor force, increased support for private sector development, improved infrastructure, and faster shift of people from the countryside to the cities.
"I am sure urbanization will continue and it will contribute substantially to the reduction of poverty in hinterland provinces," he said.
Social reforms, such as greater support for migrant worker families are also necessary, along with fiscal and monetary policy changes which put greater emphasis on macroprudential measures.
He noted that while Asia emerged in relatively good shape from the recent global financial crisis, thanks to policy and structural changes made in the wake of the 1997-1998 Asian financial crisis, there is no room for complacency as the performance of the global economy remains uncertain given the still-fragile conditions in the United States, sovereign debt problems in Europe, and rising trade and currency frictions.
Despite current tensions, the Government of China remains keen to cooperate with the U.S. on macroeconomic and governance issues to ensure future economic growth is both sustainable and inclusive. China is also keen to step up support for Asia's regional integration initiatives.
"I think we should cooperate in many areas such as financial supervision, as well as in areas such as climate change, improving the environment and addressing poverty problems which linger in Asia," he said.
China Investment Corporation is a wholly state-owned company established to diversify the country's foreign exchange holdings. It has registered capital of $200 billion just over half of which is allocated to overseas investments. Prior to joining the company, Jin Liqun served as the Vice President (Operations 1) of the Asian Development Bank (ADB). Before joining the ADB in August 2003, he served as Deputy Minister of Finance, Director General of the World Bank Department at the Ministry of Finance, and Executive Deputy Director of China to the World Bank Group. He was a member of the Monetary Policy Committee of the People’s Bank of China. Currently he also serves as Deputy Chair of the International Forum of the Sovereign Wealth Fund.
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