Consumption will be the main driving force for China's economic growth in the second half of 2005, said a senior economist in Beijing Monday.

Zhu Baoliang, chief economist with the State Information Center, said that China's retail sales of consumer goods have kept a fast growth rate of 12 to 13 percent since the second half of last year, about 3 percentage points higher than before, greatly contributing to economic growth.

As the country's fixed assets investment growth slows down and frequent foreign trade frictions lead to difficulty in expanding exports, the fast growth of consumption has started to play the major role in pushing economic development, said Zhu.

Zhu attributed the consumption boom to the quick income rise of urban and rural residents.

Disposable income per capita of urban residents increased by 9.5 percent year-on-year in the first six months this year, and the cash income of farmers went up by 12.5 percent, 0.8 and 1.6 percentage points faster over the same period last year respectively, he said.

Zhu also pointed out that a generation born after 1978, when China adopted the reform and opening-up policies and started to experience fast economic growth, now begin to enter the work force and drive up the consumption with their higher-than-average income.

"This generation, different from their parents, are willing to spend their money for a more comfortable life," said Zhu.

China registered a 9.5 percent GDP growth in the first half with a 13.2 percent retail sales growth.

(Xinhua News Agency August 9, 2005)