Healthy Development First

Healthy Development First 

By staff reporter Hou Ruili                                                                      

At the 2013 sessions of the National People's Congress (NPC) and the Chinese People's Political Consultative Conference (CPPCC) convened this March, the new leadership amended China's GDP growth prospects this year to 7.5 percent, in the hope that slower growth would lead to a focus on higher-quality development and further improvement of the quality of its citizens' life, building a "beautiful China."

Over the period from 1978 to 2012 China's GDP grew at a robust 9.8 percent annually, a miracle unfound elsewhere in the world. This hectic growth however came at a price, illustrated by the recent intense smog that has enveloped large swathe of the country and escalating pollution, signifying stress on resources and the environment mounting to a level they can barely accommodate.  

Meanwhile several domestic factors are weighing down on China's prospects for growth. The quantitative easing introduced in many countries worldwide in response to the latest economic crisis has caused a spike in the costs of key factors of productions. The dwindling demographic dividend has in particular driven up the labor cost remarkably, and some industries are mired in redundant capacity.

Problems such as redundant capacity, want of core technologies and low added value of products demand prompt action to improve the industrial structure and allocation of resources. To be specific, the nation must beef up its strength in innovation and R & D, in part by motivating its corporations to play a leading role in technological innovation, and to do so steer the capital, talented workers and technologies essential to innovation towards the business circle. China also needs to further animate its domestic market, ensure highly efficient resource allocation and improve the elasticity of supply.

As international orders plummeted amid the global economic slump, China is looking to domestic demand for the steam to power its economic growth. This demand however has to be bolstered by high employment and a sound social security system.

At its first session of the 12th NPC Premier Wen Jiabao articulated in report that the Chinese government is dedicated to ensuring the real per capita income of both urban and rural residents increase at the same rate as the general economy and that wages reflect increases in labor productivity. He also committed to increasing government spending on education and basic pensions for enterprise retirees. The new rural cooperative medical care system and basic medical insurance for unemployed urban residents will benefit from greater government subsidies this year, and the per person payment standard for basic public health services will be raised. Work will also be done to ensure a more robust foundation for agriculture and rural development and promote integrated urban and rural development. Each objective is specified by clear figures and goals, attesting the government's resolve to make solid progress on these issues

Both industrialization and urbanization are the work of a substantive number of laborers. Now as many as 260 million rural laborers have moved to the cities to work. Such urbanization breeds a huge consumption demand and facilitates the modernization of the countryside by virtue of increasing the efficiency of agricultural production, part of which comes from the realization of economies of scale. Now China is working to ensure them equal rights to public services and social welfare to retain them in cities.  

The country's paramount concern at the onset of its opening up and reform was to have its people sufficiently fed and clothed. Now the basic needs of subsistence have been met and the national economy reached a higher level, Chinese people come up with greater and more sophisticated expectations, yearning for clean environment among others. 

One highly anticipated move at this year's NPC session is the government restructuring, which reduced the number of ministry-level bodies of the State Council from 27 to 25. Of them the Railway Ministry will be split, with its regulatory powers going to the Ministry of Transport and its commercial operations to be run by a separate company. The overhaul also involves key authorities overseeing health, family planning, food and drug, press and media, oceanic affairs and energy.

The latest round of government departments streamlining is designed to slash red tape and ensure greater efficiency and accountability. It is expected to be followed by more reforms to curtail administrative powers' meddling in the market, allowing social organizations to play a bigger role in managing social issues.

Instead of recklessly going after ever-higher GDP, China now intends to ameliorate the market environment and balance issues like employment, economic restructuring and wellbeing in the course of economic development. It is paying greater attention to the potential of economic growth, sustainable supply of factors of production and the bearing capacity of the nature with the aim to take the path of sustainable development.