Chinese Vice Premier Li Keqiang attends a symposium discussing 12th five-year program held in Beijing on December 15, 2010. Li is also a member of the Standing Committee of the Political Bureau of the Communist Party of China (CPC) Central Committee (PANG XINGLEI)
Over the past two years, the Chinese Government has adopted a moderate loosed monetary policy to cope with the global financial crisis. This policy allowed China to maintain a gross domestic product (GDP) growth rate of 8.7 percent in 2009; figures for 2010 are expected to reach about 10 percent.
Despite these optimistic figures, China's policy has resulted in some negative effects as well. Skyrocketing housing costs and an increase in food prices have emerged as the result of liquidity in China's markets. In the coming year, China will have to solve these problems as it continues to modify and improve its economic growth.
China's citizens are expecting to see reforms that will improve their personal incomes. Although China's economy has enjoyed explosive growth in recent years, living conditions for most of the Chinese people have failed to improve as rapidly. Voices calling for income reform have surged since the beginning of 2010; people from all walks of life have hoped to narrow the gap between China's rich and poor that becomes larger.
"Different from ordinary reforms, changes in income distribution will personally benefit hundreds of millions of people," said Deng Yuwen, a professor at the Party School of the Communist Part of China (CPC) Central Committee.
"People may be able to bear poor living standards in the short term, but they will be disappointed if they cannot enjoy the fruits of the nation's fast economic growth," Deng said. Chinese leaders rolled out a plan for income distribution reform as part of their proposal for formulating the 2011-2015 Five-Year Program.
In addition to income reform, Chinese citizens are also looking to 2011 as a time for the further improvement of China's economic structure. The global financial crisis revealed that excessive reliance on foreign demand is China's Achilles heel; expanding domestic consumption is believed to be China's best solution to this problem. The Chinese Government's efforts to promote domestic consumption was also be highlighted in the Five-Year Plan proposals.
Although China's economic growth rate has increased dramatically in recent years, its extensive and intensive economic development is not seen as sustainable. Damage to the country's environment is one particularly troubling aspect of China's growth.
China's citizens also want more fairness in their markets. The Chinese Government's 4-trillion yuan (about $586 billion) economic stimulus package, while guaranteeing that the country's economy would continue to grow, was criticized for favoring state-owned companies which have grown much faster than their privately owned counterparts.
Employment is just one area where citizens have voiced their complaints. Although the government has invested significantly larger amounts of resources in state-owned companies, these same companies are still cutting jobs every year. In contrast, privately owned businesses and joint ventures between Chinese and foreign companies have contributed a great deal to China's employment environment.
China is currently standing at an economic crossroads. Successfully addressing these problems will help the country to make a breakthrough in its economy and prepare the country for its next round of high-speed growth.