A government-run think-tank expressed optimism on the security
of China's post-2008 economy following recent fears of an economic
depression after the Beijing Olympics.
Chen Dongqi, the vice president of the economic research
department of the China State Development and Reform Committee,
cited population expansion as the strongest factor prompting
economic growth, and said that China, classified as a large
population economy, possesses an abundance of labor, the principal
condition for growth.
Chen believes that the 20 million rural migrants moving into
urban areas annually will create a consumer demand that will
continue to fuel China's growth.
Chen gave his opinions at the third China Economic Growth and
Security Forum that started on Dec. 9, days after a panel of
high-profile economists spoke of their concerns about the
consistency of economic growth in China and the world.
Morgan Stanley chief economist Stephen Roach, said at an
academic forum in early December that the economy of the United
States worsened in 2006 at a speed faster than predicted, according
to a report from the China Securities Journal.
Roach said the Chinese economy, unbalanced and fragile, will be
confronting the perils of the US recession and trade protection and
China should prepare itself by expanding its consumer base in case
the US fails in its attempt at a soft landing, according to the
newspaper.
Andy Xie, former chief economist of the Morgan Stanley
Asia-Pacific region, was quoted by the newspaper as saying that the
"world economy will slow in 2007 and fall into a recession in
2008."
Xie, along with Roach at the same forum, listed inflation,
post-Olympics effects and predicted material price slides as
evidence of an impending world wide recession.
China should cap surging housing prices in order to make housing
more affordable for city residents otherwise the industry may
crash. Xie noted that "the real purchasing need is not that big" if
factors such as compulsory relocation and overseas requirements are
taken into consideration.
(China Daily December 14, 2006)