Bridging the income gap
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The establishment of a more rational method of distributing income is also expected to help ease the minds of people who are reluctant to spend.
Last year, China's per capita GDP was $3,678, which, according to World Bank standards, is the level for an intermediate-income country and region.
More consumption is believed to drive people to improve their standards of living and reap the fruits of the economic boom. China must transform from "a wealthy country" to a land of "wealthy people".
Premier Wen mapped out measures to push for the country's income redistribution and increase people's incomes in his government work report. To further reform how the nation distributes income, the premier vowed to adopt and effectively establish a mechanism aimed at ensuring a normal rate of wage growth. Measures will also be adopted to guarantee that the incomes of laborers will be increased.
The new distribution will also gradually favor laborers in that it will increase the proportion of residents' incomes to the national revenues and increase their remunerations in the first distribution of the country's incomes.
The first and second distribution of the country's incomes will be efficient and impartial, Wen said in his report.
He also said that effective measures will be taken to reform the current income distribution in the country's monopolistic industries. The unreasonably high incomes among these industries have long been a source of public dissatisfaction and should be strictly regulated, he added.
To frame a more reasonable income distribution mechanism, the country's financial and taxation instruments will be in a better position to regulate the redistribution of national wealth. A workable mechanism to bridge the widening income gap will also be established. In this process, forcible measures have been vowed to ban any illicit incomes and the government has promised to create a transparent and open income distribution system.
As people's living conditions improve, they have mounting expectations for the construction of a well-developed social security network and better development in other social aspects, ranging from employment, healthcare and housing to food safety. To press ahead with the long-anticipated reforms on the current income distribution, the government should take concrete steps to improve people's livelihood as a key channel to boost a lasting domestic consumption and try to construct a social security network.
The author is a senior economic analyst with the State Information Center.
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