Why is China boosting domestic market while opening up to the world?

44. Why is China boosting its domestic market while opening up to the world.mp3

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Growing domestic demand and opening up further are not contradictory.

• Chinese President Xi Jinping

One of the advantages of being a major economy is that we can achieve complete domestic circulation. China has 1.4 billion people and per capita GDP in excess of $10,000, which makes it the world's biggest consumer market with the greatest potential. Upgrading consumer spending by aligning it with modern technologies and production models can produce great potential for growth. We must regard expanding domestic consumption as the basis of our national development strategy to ensure sound dynamics among production, distribution, exchange, and consumption that are more focused on the domestic market. We must set a strategic course for supply-side structural reform and work toward a dynamic balance between aggregate supply and demand at a higher level. Growing domestic demand and opening up further are not contradictory. The fewer impediments to domestic economic flow, the more global resources will gravitate toward China, the easier it will be for us to develop a new pattern of development that focuses on domestic circulation and features positive interplay between domestic and international economy, and the greater China's ability to compete and cooperate internationally will be enhanced.

Consumption is a key driver of China's growth, and the middle-income group is the cornerstone of consumption. At present, our country has around 400 million middle-income earners, the largest in the world in absolute terms. To further expand our middle-income group, we need to introduce policies to optimize the income distribution structure by allowing the market to evaluate and award the contributions of knowledge, technology, management, data, and other factors of production. We should increase investment in human resources to enable more working people to become middle-income earners through their own efforts.

(Source: Extract from Xi Jinping's remarks at the seventh meeting of the Central Financial and Economic Commission on April 10, 2020.)

This episode is presented by Zhong Shi.