BEIJING, Nov. 13, 2023 /PRNewswire/ — China’s economic growth will remain at a moderate rate for at least the next five to 10 years, Liu Shijin, former vice minister of the Development Research Center of the State Council and member of the Monetary Policy Committee of the People’s Bank of China, told the Global Times on Wednesday on the sidelines of the Annual Conference of Financial Street Forum 2023.
"To put the Chinese economy on the track of steady growth, it is crucial to tap new growth potential and release the current potential. China still has a lot of growth potential," said Liu.
China has the conditions to achieve what developed economies have reached, Liu, citing China’s per capita GDP, which surpassed the $10,000 mark in 2019.
"The gap between the $10,000 level and the $30,000–$40,000 level (of developed economies) means that there’s huge potential for China, especially in digital technology and the green transformation."
He noted that one important thing for China is to narrow the income gap appropriately.
"If the income levels of the middle- and low-income groups can be raised and their consumption structure can be thus improved, then even if existing industries are not upgraded, there is still great potential for growth," said Liu.
This should be realized through urbanization, which would turn the 300 million migrant workers into real "city people," according to Liu.
He also stressed the importance of industrial upgrading, technological innovation, increased added value, improved industry chains and the development of future industries.
"China now has a relatively sound industrial foundation. Industrial structural reforms can boost growth. But how to promote structural reform, that is, to unleash the potential, is another important thing," said Liu.
Liu also addressed a forum called "Strengthening International Macro Policy Dialogue and Enhancing Global Economic and Financial Resilience" on Wednesday, which is one of the major events of the Financial Street Forum.
He stressed that improvements in demand and supply should occur in parallel with new growth momentum.
Expanding demand is of great significance to stabilize existing industries, including real estate. Cultivating the momentum of industrial upgrading means promoting the formation and growth of new industries, said Liu.
"It’s for sure that China appears to have significant capacity to support its growth," Stéphane Latouche, chief representative for the Asia-Pacific of Banque de France, told the Global Times on Wednesday on the sidelines of the forum.
New fiscal support of 1 trillion yuan ($137 billion), which is about to arrive, will support growth mainly for the next year, said Latouche.
China announced plans to issue an additional 1 trillion yuan in special treasury bonds in the fourth quarter, maintaining that such a move will help further consolidate the positive recovery trend of the Chinese economy.