BEIJING, Dec. 14 (Xinhua) — Chinese economy can grow at 6.5 percent a year during the 13th Five-year Plan (2016-2020) period, according to Justin Yifu Lin, of the Peking University’s national school of development and a former World Bank chief economist.
By 2020, China’s GDP per capita could reach 12,615 U.S. dollars, a substantial increase on the current level of 7,800 U.S. dollars, Economic Information Daily quoted Lin as saying Monday.
Lin attributed his forecast to domestic demand rather than exports, noting that consumption and investment will be key to realizing these goals.
In his logic, consumption growth is based on increased revenue, and revenue relies on labor efficiency, which requires technological renovation and industrial upgrading, both of which depend on investment.
China is rich in investment resources given the Chinese government’s debt ratio stands at 56 percent of GDP, much lower than developed countries, whose debt ratio usually well higher than 100 percent, Lin said.
“China’s private savings are as high as 50 percent of national GDP,” said Lin, adding that the country also has foreign exchange reserves of 3.5 trillion U.S. dollars. Enditem
Editor Xuefei Chen Axelsson
One thought on “China keeps 6.5-pct growth, no problem: Justin Yifu Lin”
In 2005 in London, I asked him whether Chinese economy is sustainable. He said the pollution issue is an issue occurring during development. It can be solved through development. He was optimistically saying that Chinese economy will keep double digit for another 10-15 years.
In fact, heavy smog took place in Beijing in 2013 already. That was eight years after that lecture.
Since last year, Chinese economy has to slow down because the world doesn’t have that much money to buy any more.