As most of its people have shaken off the shackles of poverty, China has set itself the higher goal of building an overall well-off or xiaokang society.

That goal embodies much more than the buoyant economic indices the country has been pursuing for decades.

Once their basic needs of food, shelter and clothing are satisfied, people's desires become much more diverse.

There's a growing trend to care about such non-material things as self-esteem, greater freedom in personal development, and a comfortable living environment. The objectives of different social strata are equally diverse.

Generally speaking, the road to a xiaokang society is paved with sustained economic growth coupled with progress on all fronts.

All-round social development requires four basic elements: artificial assets such as machinery, infrastructure and financial assets; natural resources, including forestry, water, soil and mines; human resources; and intangible social resources such as cohesion and established values.

The four elements are equally important and none should be ignored in the construction of a xiaokang society.

However, developing economies often tend to focus on the growth of artificial assets at the expense of other elements.

For example, some countries concentrate on bolstering their economy by mass logging of primordial forests and exhaustion of mines, which only saps the sustainability of their development.

Although the growth of gross domestic product (GDP) achieved in this way can help improve things like the infant mortality rate and overall life expectancy, it creates such negative impacts as pollution, acid rain and the greenhouse effect.

In some places, welfare indices such as the Gini Coefficient, a key gauge of income equality, have worsened amid growing GDP numbers.

China's development on the economic and social fronts is emphatic, thanks to the reform and opening-up strategies taken over the past two decades.

For example, the illiteracy rate for people aged from 15 to 50 declined from 23.5 per cent of the population in 1982 to 6.7 per cent in 2000. The nation's forestry area rose from 12 per cent in the early 1980s to 16.55 per cent by the late 1990s.

Still, China's concern for natural, human and social resources continues to lag behind that for artificial assets, resulting in backsliding in some aspects.

For example, the imbalance in education facilities in different areas has widened since 1995. The drain on arable land and forests remains serious. Some 90 per cent of natural pastures in the country have deteriorated. The intensifying pollution of water and air has yet to be checked.

Within the social framework, the decline of credit, trust and public morality is an incontrovertible fact, although no tangible measures are available to gauge it.

The impact of these defects will eventually surface and curb social progress and the improvement of people's welfare.

Balanced care for all resources should be promoted, otherwise the goal of a xiaokang society will be difficult to achieve.

Take the consumption of motor vehicles as an example. China now has roughly 24 million vehicles, with cars accounting for less than 30 per cent. These vehicles guzzle oil refined from 420 million barrels of crude each year, a huge strain on China's crude oil production, which is 1.1 billion barrels annually.

China therefore must rely on imports to meet the mounting oil consumption at home.

By reckoning, the import of crude oil may exceed 80 million tons, making up over 30 per cent of domestic demand.

But as China's per capita GDP approaches US$3,000, more and more families will own private cars. Analysts have estimated that by 2020 China's auto numbers will jump eight to nine fold from the current level more than 50 per cent of which will be sedans.

If the per unit oil consumption cannot be reduced effectively, the huge number of automobiles will drain China's dwindling oil reserves, not to mention the daunting costs paid for imports.

This example is not aimed at thwarting private car ownership. But the administration is responsible for anticipating similar pitfalls in the building of a xiaokang society and must take the necessary precautions.

The government should strengthen the protection of natural resources and the environment, and encourage the build-up of non-material resources.

It needs to bolster investment in education, training and healthcare to improve the quality of human resources. Fostering a credit system and cultivating greater trust between the government and citizenry are other daunting tasks.

Only the comprehensive development of all resources, both material and non-material, can lay a sustainable foundation for the country's pursuit of greater prosperity.

(China Daily January 9, 2004)