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Sun Xiaoyu

In recent years, China’s economic relations with countries worldwide have become closer, and its overall, coordinated and sustainable development has attracted the common concern of the international community. In order to realize the strategic goal of building a well-off society in an all-round way, China is formulating the 2006-2010 Five-Year Plan and the long-term goal by 2020. While making plans, strategies and policies for further development, China should take into account both the domestic conditions and the global economic environment and development trends.

In the past 26 years, due to the implementation of the reform and opening-up policy, the Chinese economy has maintained an average annual growth rate of 9.4 percent, lifting 200 million people out of poverty nationwide.The lives of 1.3 billion people have, by and large, madethe historical transition from merely having enough food and clothing to having a comparatively comfortable life. In 2004, the country’s total volume of imports and exports exceeded 1 trillion U.S. dollars, ranking third in the world. China is a major importer of global capital products, intermediate goods and resource products, and also supplies various countries with large quantities of economical and high-quality consumer goods. At present, 230,000 foreign-invested enterprises are operating in China, providing about 25 million job opportunities. The products and services they provide have enriched the life of the Chinese people. The flow of production factors between the domestic and international markets has not only optimized resource allocation and benefited the welfare of the people, but also deepened the public’s awareness of economic globalization, i.e. only by creating cooperative and harmonious relations between nationscan the win-win goal and sustainable development be achieved.

The prosperity the Chinese people are enjoying is still at a low level, incomplete and uneven. The country’s per capita income is still very low, ranking behind the world’s top 110 nations. For a considerable time to come, the Chinese economy has to continue its fast and steady development. A recent study by the Development Research Center of the State Council indicates that the Chinese economy can maintain a growth rate of about 8 percent in the next five years and the goal of quadrupling the 2000 GDP by 2020 may be achieved ahead of schedule. By that time China will have a more developed economy, a sounder democracy, more advanced science and education, a more thriving culture, a more harmonious society and a more comfortable life for its people, and consequently make a greater contribution to world peace and development. At present, China does not account for a large proportion of the aggregate of the global economy, but its proportion of increment in global economyis considerable and is becoming one of the important engines of world economic growth. China’s further opening and greater prosperity will not only benefit 1.3 billion Chinese people, but also provide enormous investment opportunities and a huge market for countries across the world.

China’s long-term development strategy is based on domestic demand. In the next 5 to 15 years, advance of industrialization and urbanization and the large-scale infrastructure construction in both urban and rural areas will create a huge roomfor investment. Increases in income and the upgrading of the consumption structure will bring about a sustained expansion of consumer demand. It is entirely possible for China to continue the rapid growth by relying on its vast domestic market, its abundant labor resources, its high personal savings ratio, its reform-based social vitality and the technological innovation and late-developing advantage. China will continue to encounter many problems in the long process of industrialization and urbanization. They include how to optimize resource allocation and utilization, how to create morejobs and raise living conditions for large numbers of peasants moving into non-agricultural occupations, how to prevent excess income disparities between different regions and social groups, and how to deal with the upcoming problem ofan ageing society, etc. To achieve an all-round, coordinated and sustained development, China has adopted a new concept of development strategy, emphasizing the concept of people-first, the development of a conservation-basedeconomy, the building of a harmonious society, and ensuring that development results could benefit all.

In the 21st century, the developing countries worldwide are entering the phase of industrialization one after another. As a result, contradictions between population, resources and the environment are becoming even fiercer. Like many countries, China’s development also faces resource and environmental problems. China is both a large resource producer and a major resource consumer. To achieve sustainable development, China should rely on scientific advances, taking a new road of industrialization, developing a circular economy and building a resource conservation-based society. Over the past 22 years, China’s energy consumption per GDP unit dropped 66.8 percent at constant prices. Despite this, the total energy and resource consumption is still visibly higher than that of developed countries. Increasing the efficiency of resource and energy utilization through technological advance remains an enormous task. In order to ease the pressure of industrialization on resources and the environment, China must strive to change its mode of economic growth, introduce advanced technologies and equipment and further increase the efficiency of resource utilization. Therefore, China will actively undertake international cooperation in the areas of energy and environmental protection and follow a road of sustainable development. As China’s per capita possession of most economic resources is lower than the world’s average, its dependence on foreign markets will inevitably increase as the economy develops further. During rapid industrialization, China will continue to be one of the leading importers of primary and resource-intensive products and will have to work with various countries to maintain price stability for primary products on the international market.

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*This is a speech made by the author at "China Development Forum 2005" held in March 2005 in Beijing.