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China Aims High for Economic Quality
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At the annual economic work conference held by the Central Government on December 5-7 last year, a new slogan for development in 2007 was proposed. The slogan captures the aim to develop the quality of the economy first, rather than focus on speed, so that the economy will develop in a balanced and coordinated way. Instead of "fast and good," the slogan is now "good and fast," so that the emphasis is on the quality of development. Although this looks like a simple word order adjustment, it has great significance, as Jia Kang, a research fellow at the Financial Research Institute under the Ministry of Finance, explains in an interview with People's Daily reporter.


Reporter: "Fast and good" or "good and fast" – they seem very similar as both emphasize quality and speed. What is the difference between the two? 


Jia Kang: The new "good and fast" slogan prioritizes quality; quality will drive development. This is not just a simple reordering of words; it reflects the scientific concept of development. In the past, we used "fast and good," which put more emphasis on speed. Although both slogans reflect the importance of paying attention to quality and speed, people have always paid more attention to speed and scale rather than the quality of economic development.


Q: Then the change in word order is an important sign that China is altering the course of its economic development to one that is more scientific?


A: Yes. Theoretical analysis shows that only when the quality and efficiency of the economy are high, the cost of resources and energy is low and operations are environmentally friendly will we see the positive effects of rapid development. If the economy is headed in the wrong direction, the faster it develops the faster the situation will worsen. If that happens, resources are wasted and development is not sustainable. Now we are emphasizing quality development to ensure that resources are used more efficiently.  For years, in practice, China has prioritized speed ahead of quality, and this has been a mindset that is difficult to change. Only when quality development is the guiding principle can we avoid a situation where GDP growth is the sole goal. By emphasizing quality first, we can adjust the economic growth mode, saving resources and energy and protecting the environment. The change will also be conducive to increasing innovation and avoiding a contradiction between speed and quality in economic development.  China first proposed this idea some time ago. In the 1950s, China focused on rapidly building a vast, superior society using minimal resources. However, people focused solely on speed and quantity, and sacrificed quality and efficiency in resource management.


Q: At the Central Government's economic work conference, prudent fiscal and monetary policies were again proposed. What are the differences between prudent fiscal and monetary policies in 2007 and those in the past?


A: Prudent fiscal and monetary policies have been implemented for three years. In 2004, those policies tended to be tight. In 2005 the policies were a bit loose and in 2006 the policies tightened again. Under the umbrella of prudent fiscal and monetary policies, some changes have been made, but the main focus has always been readjusting and optimizing the economic structure.


Currently, the central bank, the People's Bank of China, pays great attention to inflation. So we will continue to have tight financial and monetary policies. Over the last few years, such policies have played an important role in optimizing the economic structure. These policies are helpful in reducing deficits, but not on a large scale; their main role is to help adjust the economic structure.


To be more specific, the main purpose of prudent financial policies is to control deficits, readjust the economic structure, promote further reform, increase income and cut back on expenses. They also specifically reflect the idea of quality-based economic development. As part of prudent financial policies, the Ministry of Finance emphasizes redistribution policies so that such policies gradually narrow the income gap in China and promote social equity and stability in the long run.




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