Panel discussions: How to boost consumption
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How to transform the current economic growth pattern to make it more sustainable is one of the major topics at this year's NPC and CPPCC sessions. Let's take part in several panel discussions of CPPCC members, and tells us what the political advisors are suggesting.
How do you boost domestic consumption and get people to be "not afraid" to spend? That's one of the questions that has been frequently tossed out to the advisors these days.
Jia Kang, CPPCC member, said, "I think the government needs to pay more attention to low-income earners, and improve the social safety net. That way, people will have the confidence to spend. Also the government can work out more tax breaks to encourage spending."
Since the outbreak of the world financial crisis, China has introduced various measures to spur spending and domestic demand. Those measures include tax reductions on home and auto purchases, tax cuts on stamp duties for stock trading, and several interest rate cuts.
So, what more can be done? Some suggest speeding up the urbanization process, and tap into the vast rural population.
Hu Deping, CPPCC member, said, "We should break up the old concept of cities and countryside, which has isolated the two parts. The rural area is such a vast market. In terms of domestic consumption, it will ensure China 10 to 20 golden years of development."
Another proposal is raising eye brows. It suggests that the government allocate its foreign exchange reserves to everyone, and let them spend it. Is this even possible? Apparently, a few people have already voiced their concern.
Zhang Xiaoji, CPPCC member, said, "It's a misunderstanding that a country's forex reserves can be allocated. It doesn't work that way. How did the government get the foreign exchange? It's when people exchange their foreign currency for the equivalent in RMB. So the forex reserves cannot be considered a disposable assets."
Whether it's workable or not, CPPCC members are all brainstorming to fill in their ideas on how to push domestic consumption.
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