12Th Five-Year Boao Forum: Best Time To Invest In China

Yesterday, the Boao forum for Asia "the Middle Income Trap" Asian style evasion "sub forum", the participants discussed whether Asian emerging economies can avoid the "middle income trap" and other issues.

Yesterday, "China's integration into the world: sharing a win-win ten years" forum, China's permanent WTO ambassador Yi Xiaozhun (left) and India Minister of Commerce and trade Sharma talked at the forum.

In March this year, the National People's Congress passed the "12th Five-Year" development plan outline, depicting the grand blueprint for China's economic and social development.

How to interpret the "12th Five-Year plan" plan? Yesterday, at the 2011 Annual Meeting of the Boao forum, "policy interpretation:

Solving the problem of "three no" depends on scientific development.

China's total economic output has surpassed Japan as the second largest economy in the world, but the unbalanced, uncoordinated and unsustainable development problems still need to be solved in China during the "12th Five-Year" period.

"At present, the unbalanced, uncoordinated and unsustainable problems in China's economic development are more prominent and become the main obstacle to scientific development and harmonious development."

Zhang Ping said yesterday.

Pepo Greenwood, vice president of the Asian Development Bank, said that China's current economic and social development has three imbalances, one is social imbalance, two is income inequality, and three is environmental imbalance.

"High energy consuming industries, high polluting industries, especially heavy industries, have risen further since the late 90s of last century, exacerbating the environmental deterioration."

All these problems need to be solved in China during the "12th Five-Year" period.

Zhang Ping pointed out that solving contradictions should rely on development and scientific development is the absolute principle.

And accelerating the pformation of the mode of economic development as the main line is the only way to promote scientific development, which is in line with China's basic national conditions and the stage characteristics of its development.

This has been fully reflected in the outline of the 12th Five-Year development plan.

Expanding domestic demand and promoting innovation is the top priority.

China's economy is overly dependent on exports, relying heavily on inputs such as resources and labor and over reliance on investment. The "12th Five-Year plan" gives a comprehensive solution to the above problems, one of which is to vigorously promote domestic demand, the first is to strengthen innovation and readjust the economic structure.

Zhang Ping pointed out that the "12th Five-Year plan" further defined the key tasks of China's economic and social development in the next five years.

The first thing to do is to further expand domestic demand and promote steady and rapid economic development.

"During 12th Five-Year, China will expand consumption demand as a strategic focus for expanding domestic demand and make greater efforts in establishing a long-term mechanism to expand demand."

Professor Barry Naughton is very optimistic about the huge potential of China's domestic demand and said that China's huge consumer market will become an important engine to promote economic development in the new stage.

This means that the Chinese government must reduce excessive support for the development of the manufacturing industry, and further promote the reform of the distribution system and welfare system to ensure more capital flows into the family, thereby promoting consumption.

Zhang Ping stressed that another important task of the 12th Five-Year plan is to accelerate the strategic adjustment of the economy and give play to the important role of scientific and technological innovation in economic pformation.

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Government's focus shifted to public service

China's investment in the field of public services appears inadequate. During the "12th Five-Year" period, China needs to maintain a reasonable scale of investment, whether it is to increase the supply capacity to meet the material and cultural needs of the masses, or to actively promote industrialization and urbanization.

Little Greenwood suggested that the Chinese government should shift its focus from the former specific highway and other infrastructure investment to public service investment in the aspect of investment. "China's investment in health and education accounts for 50-52% of the same level of development in China, while China has only 38%.

The Chinese government should invest more money in health care and education. "

On this issue, Zhang Ping said that in the "12th Five-Year plan" outline, it is clear that the state will invest more in establishing and improving the basic public system, and the investment will focus on ensuring housing construction, public education, public health care system construction and urbanization.

Zhang Ping also said that the Chinese government will further optimize the investment environment and guide more social capital (including foreign investment) to invest in modern agriculture, high-tech industries, advanced manufacturing, energy conservation, environmental protection and modern service industries, and guide more social capital to invest in the central and western regions.

China's economic development has been driven largely by external demand. China now emphasizes domestic demand and emphasizes urbanization. Large-scale infrastructure construction will make China the most important consumer power in the world.

Wei Jiafu, the head of COSCO Group, who participated in the formulation of the "12th Five-Year plan" discussion, pointed out that China's economic development was too much driven by external demand. There was an imbalance between imports and exports and irrational trade structure.

China now stresses domestic demand and emphasizes urbanization. Large-scale infrastructure construction will make China the most important consumer country in the world.

In the first quarter of this year, China became a deficit country in import and export trade. The import of large quantities of manufactured goods greatly improved the structure of COSCO Shipping business.

Wei Jiafu said, "I can tell investors in developed countries that this is the best time for you to come to China for western development and Reinvestment in the mainland.

You can share dividends in China through investment in the mainland. "

"China is facing a series of deep-seated problems that need to be solved. The key to solve these problems is still development.

The path to achieve scientific development is to further enhance domestic demand and promote the pformation of economic development mode by innovation.

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- Zhang Ping, director of the national development and Reform Commission

"I can tell investors in developed countries that this is the best time for you to come to China for western development and Reinvestment in the mainland.

You can share dividends in China through investment in the mainland. "

- Wei Jiafu, President of COSCO Group

China's investment in health and education accounts for 50-52% of the total investment in China at the same level of development, while China has only 38%.

The Chinese government should invest more money in health care and education. "

- Lawrence Ogreenwood, vice president of the Asian Development Bank

"The Chinese government must reduce its excessive support for the development of manufacturing industry, and further promote the reform of the distribution system and welfare system to ensure more capital flows into families, thereby promoting consumption."

- Professor Barry Naughton, director of China International Affairs Center, California branch, San Diego University, USA

Hot topics

In response to hot money's impact on Asia, please "embankment" ahead of time.

In March, China's foreign exchange reserves increased significantly by US $197 billion 400 million, indicating that a large number of hot money continued to pour in.

Also facing the threat of hot money and many emerging countries, hot money issue has become the focus of attention at yesterday's Boao conference.

At the annual forum of Boao forum for Asia 2011 Annual Forum "coping with capital inflow:

Liu Erfei, chief executive of the US Bank of China Merrill Lynch, believes that hot money has little impact on the Chinese market.

"The scale of billions of dollars flowing into the Chinese market every year is relatively small for our total currency."

In addition, Liu Erfei believes that due to China's foreign exchange control, most of the hot money will be blocked outside the firewall.

Anthony Bolton, President of Fidelity International, further analyzed that China's capital market is immune to the influx of hot money, and the test of the global bubble to China is mainly concentrated in Hongkong.

However, Jiang Jianqing, chairman of ICBC, reminds us that the rapid growth of foreign currency inflows in the short term should be highly valued.

Jiang Jianqing pointed out that many foreign inflows of hot money into China's real estate market, to the already flooded real estate market has brought a new financial impact, the real estate price bubble caused by hot money in the end how much is very worthy of attention.

In the face of this new round of capital shocks, the International Monetary Fund has made an exception for the first time to allow capital controls. At yesterday's forum, experts also said that to cope with hot money, countries should build "flood embankments".

Jiang Jianqing believes that coping with hot money must first have a very sound financial system, which includes macro Prudential Management and a micro competitive market system. The capital market must have enough depth and breadth to undertake these shocks, because "big capital markets are hard to shake".

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Tidbit

Talking about adding interest Jiang Jianqing to make "Tai Chi"

Yesterday, the National Bureau of statistics released the March macroeconomic data, of which CPI rose 5.38%, a 32 month high.

A reporter asked Jiang Jianqing, chairman of ICBC, how do we see the current high CPI situation? Will interest rates be raised again in the near future?

For the first question, Jiang Jianqing said that with the continuous implementation of China's macroeconomic regulation and control structure, I believe that this year's expected economic growth targets and inflation control objectives can be achieved.

For raising interest this very sensitive problem, Jiang Jianqing said, "just saw Zhou Xiaochuan in the corridor (central bank governor), you can ask him."

Authoritative viewpoint

Former US Treasury Secretary Henry Poulsen: less investment in real estate bubble

Yesterday, Zhou Wenzhong, Secretary General of the Boao forum for Asia, launched a dialogue with Paulson, the seventy-fourth US Treasury secretary.

"At present, the US capital market" has returned from the edge of the cliff and is functioning normally.

Some big banks are recovering quickly and capital adequacy is also recovering rapidly.

Future big banks will be tighter regulated. "

Paulson said that many policies in the United States are promoting the emergence of deficits. "We borrow too much and save too little. This is not sustainable."

Paulson agreed with China to further liberalize financial regulation. He believed that diversification and mixed operation could provide more financial investment products for the public.

Paulson said that to some extent, it was because of the small number of investment products in China that a certain real estate bubble was created.

Yesterday, Yasuo Fukuda, director of the Boao forum for Asia, said that after the recent earthquake and tsunami, Japan received various support from all parts of the world, and the Chinese government also expressed its willingness to provide various kinds of support at the very first time. On behalf of Japan, he expressed his thanks.

"The Japanese earthquake and tsunami caused another disaster, that is, the Fukushima Daiichi nuclear power plant accident. We are continuing to solve this problem.

This is a pity not only for the neighboring countries but also for the entire international community, "Yasuo Fukuda said." after considering the major accident at Fukushima Daiichi nuclear power plant, reconsidering the safety standards of the nuclear power plant is an unavoidable problem. "

But abandoning all nuclear power plants may be short-sighted.