China and the World Bank are making significant progress on a joint report on how the world's second largest economy can move to a path of sustainable growth in the face of today's challenging global economic situation, said World Bank Group President Robert B. Zoellick.
Commenting in Beijing on a weekend workshop with senior Chinese officials and outside experts, Zoellick said there was agreement that China would have to rebalance its economy, improve the environment, reduce inequality and advance the quality of life for its people while at the same time maintaining rapid growth.
"The challenge of China adjusting its growth model will be even more important given the current economic climate of slowing growth and weakened confidence," said Zoellick. "But China has proven time and again over the last thirty years that it can make remarkable progress in bringing prosperity to its people, and thereby boosting regional and global growth. China's growth potential remains high. We believe the World Bank can assist China to grow smartly and sustainably while avoiding the so-called ‘middle-income trap'."
The report is to be released later this year and is being prepared jointly by China's Ministry of Finance, Development Research Center of the State Council and the World Bank. The report seeks to support China in identifying the many challenges and policy choices it faces to 2030 as it seeks to avoid the so-called "middle-income trap", a stage of economic development that has slowed progress in many countries.
Adds Zoellick: "China's 12th Five Year Plan points the way forward with the ‘what' needs to be done, while this report will try to help with the ‘how'. In the tradition of Chinese leader Deng Xiaoping's openness strategy, the report will discuss practical steps that China can take to shift away from an over-dependence on export-led growth to a greater reliance on domestic demand and investment."
The issues covered by the study include how China can complete its transition to a market economy; how to promote open innovation; how to advance green development; how to deliver equality of opportunity and social security to citizens; how to strengthen the fiscal system, and how China can become a responsible stakeholder in the international system. The study is expected to be completed towards the end of 2011 and the findings will be shared broadly.
In Beijing, Zoellick met with Vice President Xi Jinping, Executive Vice Premier Li Keqiang and Vice Premier Wang Qishan and discussed the global economic situation and challenges for policymakers, climate change, and economic cooperation and knowledge sharing among developing countries.
He also met with Minister of Finance Xie Xuren, People's Bank of China Governor Zhou Xiaochuan, Minister of the Development Research Center of the State Council Li Wei, Minister of the Development Research Center of the State Council and Vice Chairman of the Office of the Central Leading Group on Economic and Financial Affairs Liu He, and China Construction Bank Chairman Guo Shuqing.
Zoellick also traveled to China's Northeast. He met with Party Secretary Sun Zhengcai of Jilin Province in Changchun to learn about the province's achievements and to discuss the Bank's assistance in addressing its challenges.
In Heilongjiang Province, Zoellick visited Beidahuang, which literally translated means "great northern wilderness". The region has been transformed into a grain producing area known as the Great Northern Granary of China. Zoellick visited a farm, a rice mill, an agricultural research center and a modern agricultural machines park, and talked with staff and farmers to learn about how this transformation has affected their lives.
"Food security is a global concern, and the World Bank is working closely on this challenge with the G-20. All countries must work together to address it. China feeds 20 percent of the world's population with less than 10 percent of the world's agricultural land and less than six percent of its water. China could make a significant contribution to global food security," said Zoellick.