China's rising domestic market has great growth potential and will provide opportunities for the world, said Yu Guangzhou, vice-minister of commerce.
"The nation's consumer market is not only a major driver for its own growth but also a propeller for the world economy," Yu said at the three-day China Development Forum that concluded in Beijing yesterday.
China's GDP expanded 11.4 percent in 2007, making it the world's fourth largest economy. The nation's role in the world economy has simultaneously risen consistently over the years.
According to the World Bank, China's contribution to global economic growth averaged 13 percent over the past five years. The nation was expected to overtake the US as the largest contributor to world economic expansion last year, the International Monetary Fund had forecast earlier.
"With domestic consumption continuing to rise, so will the nation's demand for imported products," said Yu. "The booming market will translate into even bigger opportunities for overseas enterprises."
China's imports have grown at an average of 26 percent annually since its entry into the WTO. The country's total imports ballooned by 3 billion yuan in the first two months of 2008.
"China's economy is now shifting to one driven by consumption," said Yu. "Meanwhile, rising purchasing power of people means greater demand for high-end products."
China is poised to account for 23 percent of the world's luxury market and become the biggest consumer of luxury brands such as Louis Vuitton and Bentley, according to Yu. And, Chinese travelers are expected to make 100 million trips abroad in 2015, compared with 30 million now.
"Even if it grows at only 10 percent annually, China's domestic consumption will grow 3.5 times to 30 trillion yuan by 2020," said Yu.
Consumer spending has risen at an average annual rate of 13.1 percent over the past five years. In 2007, China's per capita income crossed $2,000, a threshold that promises fast growth in local consumption. Yet, domestic consumption accounted for less than 50 percent of the nation's total output, 28 percentage points lower than the world average.
(China Daily March 25, 2008)