China set to grow 8 pct a year; reforms needed for inclusive growth

The People's Republic of China (PRC) is set to grow at an annual average rate of 8 percent for many years to come, but the country needs to carry out broad structural reforms to ensure that prosperity is shared by all, a leading PRC investment official said on Friday.

The PRC's growth strategy will not only be important for the country itself, but also for its neighbors, and for the rest of the world, said Jin Liqun, Chairman of the Board of Supervisors of China Investment Corporation, in a presentation at the Asian Development Bank's (ADB) Eminent Speakers' Forum.

He 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, Jin 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 still-fragile conditions in the United States, sovereign debt problems in Europe, and rising trade and currency frictions.

Despite current tensions, the Government of the PRC remains keen to cooperate with the US on macroeconomic and governance issues to ensure future economic growth is both sustainable and inclusive. The PRC 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.