Consumption replaced investments as the most powerful engine of
China's economic growth in 2007 for the first time in seven years,
a senior official with the National Bureau of Statistics (NBS) said
on Wednesday.
China's gross domestic product (GDP) grew 11.4 percent
year-on-year to 24.6619 trillion yuan (3.43 trillion U.S. dollars)
in 2007. The 11.4 percent growth broke down into 4.4 percentage
points driven by consumer spending, 4.3 from investments and 2.7
contributed by net exports.
Investments, consumption and exports are the troika pulling
along any economy. In China, the share of domestic consumption in
the GDP growth shrank to 39.2 percent in 2006 from 63.8 percent in
2000.
It was said the country's troika consisted of two strong horses
-- high investment rate and exports, and a weak donkey -- domestic
consumption. Worries were that a economy was in risk if it relied
too much on investments and overseas markets.
But something is changing now.
China saw its consumer spending going up 16.8 percent to 8.92
trillion yuan in 2007 and beat investments as the biggest
contributor to the GDP growth.
Analysts said the government's policy of powering consumption
and curbing investments has led to the dramatic shift, which was
also supported by swelling income of residents.
Statistics show that the annual disposable income of urban
residents surged by 12.2 percent to 13,786 yuan last year while
that of rural residents climbed by 9.5 percent to 4,140 yuan.
"Our policy is to push up domestic consumption by raising the
income of citizens, especially that of the low-income group. And
the figures show the policy begins to yield results," NBS spokesman
Li Xiaochao said on Wednesday.
Experts hold the troika of the economy will maintain a
comparatively fast momentum in 2008 and consumption is expected to
play a larger role in overall economic growth amid tight monetary
policy and checked trade surplus increase.
"The growth of consumer spending is accelerating and the retail
sales are predicted to grow by 17 percent in 2008," said Zhang
Xinfa, chief macro-economic analyst with China Galaxy
Securities.
(Xinhua News Agency January 30, 2008)
