The Chinese Government today urged to give priority to sustaining growth and domestic demand to turn the downward pressure of the economy, when the World Bank on Wednesday recommended Beijing to stimulate household consumption in its latest report on East Asia.
“China should give more priority to maintain growth and adopt preventive policies that are more appropriate to the changing situation,” said today in a statement published by the official Xinhua news agency after a meeting of the State Council headed by Premier Wen Jiabao.
The text highlights the “prominent contradictions” and “problems” still exist in China’s economic policies, and in particular, emphasizes that “the pressure of a downward economic movement is growing.”
“We should make efforts to improve the relevance, flexibility and foresight of the economic measures and take action to expand domestic demand.”
The mission statement of the Chinese authorities came hours after the World Bank (WB) published its latest report for East Asia from Tokyo, noting that although the growth will continue in 2012 in the region, it will be at a slower rate and their model is vulnerable to the European crisis.
The World Bank expects that the average growth in the area this year will moderate to 7.6 percent, down from 8.2 percent in 2011, as a result of the overall situation and a slowdown in China.
In the case of the Asian giant, the report noted the “need to stimulate household consumption,” while others, such as the Philippines and Indonesia, would require greater investment in infrastructure.
The slowdown in China in the coming decades will challenge the region, as an expected drop in Chinese imports of raw materials will affect Asian countries that produce these resources.
Although the message from the communist authorities in line with that issued by the World Bank, the Chinese government did not specify whether it was a response to the guidelines of the World Bank.
According to the official news realse, China will issue specific guidelines to encourage more private investment in national industries after allowing their entry into the rail and health sectors, in order to boost growth.