With a worrying growth gap, China Five Year Plan is focused on emphasising development over growth. First the significant drop in the target GDP growth from 7.5% to 7% is a striking feature of the plan. Secondly, the target increase for household income growth from 5% to 7% is a significant step forward in tackling the perturbing low levels of household consumption. Furthermore, China has reoriented its policies priorities; “the income growth target under the previous FYP was much more modest than the GDP target”.
In 2011 the FYP has put down a target of 8% GDP growth and kept the target Consumer Price Index at 4%. It will also aim to create 9m jobs and keep a constant 41.6% of registered urban unemployment. Furthermore, the NPC will focus on the overall transformation of the economic growth mode, boost domestic demand and focus greater efforts towards social progress.
The government is also actively trying to exit the stimulus cycle. A clear shift is outlined in monetary and fiscal policy from expensive to normalization, according to IHS. The ambition is to reduce the government deficit by 150bn Yuan, which represents an 18% drop since the 2010 targets.
No comments:
Post a Comment