Beijing to renew growth through supply-side reform

Beijing is exploring ways to improve the quality of the city's goods and services, as part of nationwide supply-side structural reform.

"Besides garments and groceries, we will now sell aircraft," Liu Bing, chairman of Beijing Wangfujing Department Store Group, told the ongoing annual meeting of Beijing's municipal legislature. In cooperation with drone-maker DJI, both airborne and earthbound robots will soon be found on the shelves of Liu's stores.

Supply-side structural reform is the latest buzzword in China and has been widely discussed at the meeting. The phrase basically means higher quality goods and services, with lower costs for businesses and more consumption.

According to a report published on Jan. 22 when the Beijing meeting opened, the city will use Internet, big data and cloud computing technologies to improve its service industry.

The city will also encourage community-based services and try to attract private capital into education, hospitals, culture, tourism, pensions and sports. Beijing will also support mid- and high-end local brands, and improve the city's cross-border e-commerce, online retailing and wholesale businesses. Green products and the organic food market will receive special attention.

Beijing vice mayor Li Shixiang said, "We not only expect better sales, but higher quality services."

There is abundant demand, but a lack of creditable brands and poor supply; a mismatch with increased consumption ambitions, said Li. Tourism, medicine, education, pensions and health are emerging markets with great potential if they can offer high quality supply, he added.

"Our plan to sell drones is a supply-side reform trial," Liu Bing said. "In face of competition from e-commerce, retail outlets need to provide consumers with surprises to retain their appeal."

In 2015, Beijing recorded 11.4 percent growth in service consumption, 1.5 percentage points higher than the growth of product consumption. The service industry provided 79.8 percent of local GDP in 2015.

According to the city's 13th five-year plan published in December, Beijing aspires to be a world renowned scientific innovation center with the service industry accounting for over 80 percent of local GDP by 2020.