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| China should shift focus back to restructuring its growth model and upgrade industries to increase profit, Wu Jinglian, a renowned economist and researcher at the Development Research Center under the State Council, told Saturday’s Pujiang Innovation Forum. "China’s stimulus has effectively reversed the economic slowdown, a success for the country in the short term," Wu said. "The long-term interests of China still lie in a better growth model, which promotes knowledge and innovation-driven development, instead of dependence on cheap labor." China has just released a series of encouraging economic data. The country’s gross domestic product expanded 8.9 percent from last year in the third quarter, up from increases of 7.9 percent in the second quarter and 6.1 percent in the first three months. "We have achieved our short-term economic goal. But it is not sustainable if we can’t continue to create jobs and raise people’s income," Wu said. "The core to realizing that is to improve the growth model and maximize profit in our companies. The priority now should be to go back to restructure the growth model, the process which started in 1995 but was weakened by the need to address the global financial crisis." Wu said companies should try to move to more profitable sectors in the global value chain, including research and development, designing, marketing, distribution and financial services, instead of merely manufacturing. The country should also support development of new industries, encourage innovation and commercialize technology to power the country’s economy, he said, adding that China should enhance support for small and medium-sized enterprises in particular. "Companies, instead of government, should play a key role in innovation, and small companies should play the leading role in it." |
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