Home >

Shifting China'S Focus From Exports To Consumption Is The Best Way To Maintain Economic Growth.

2012/1/26 11:06:00 52

BNY Mellon Asset Management (New York Mellon bank asset management), a fixed income professional company Standish Mellon Asset Management Co. LLC, believes in a white paper that China's best plan to maintain high economic growth is from

Exit

The guiding economic growth mode has changed to the consumption oriented economic growth mode.

This report shows

China

The economic success is not accidental. The success factors include high domestic savings, strong foreign direct investment and overall openness to international trade.

Other China listed in the report

Favorable factors

It also includes low labor costs, better balance sheets of the central government and entrepreneurial spirit.

However, the report clearly shows that China's population is aging and the situation of labor surplus is gradually disappearing.

In addition, the report also points out that wage increases will affect China's export competitiveness relative to its Southeast Asian neighbors.

Thomas D. Higgins, global macroeconomic strategist and author of the report, said that other factors that might slow down China's export oriented economic growth include immature financial markets, capital allocation not only by the government but also by the market, and the rapid increase in environmental costs.

Standish honorary chairman,

white paper

Edward Ladd, co-author, said: "China is trying to rebalance the economy, reduce its dependence on exports and investment, and turn to consumer spending to tackle the challenge.

The country has also begun financial reforms aimed at gradually turning interest rates into market and enhancing exchange rate flexibility.

All these things are uncertain, but the old mode of economic growth built on exports and investment has become increasingly unworkable.

The report points out that the expansion of social safety nets can enhance the importance of consumer spending.

important factor

This can help families not to spend too much money on savings for the purpose of providing for the aged and treating diseases when the population is aging.

The Standish report shows that the pition to a new generation of national leaders is expected to begin in 2012, which will set the tone for future policies.