China's Leaders Want To Slow Their Heated Economy
ARI SHAPIRO, host:
Chinas leaders want to put the brakes on their superheated economy.
NPRs Louisa Lim reports from Beijing on how difficult that could be.
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LOUISA LIM: With fanfare, Chinas next five-year plan was unveiled as parliament opened this weekend. The local media seems to have taken away one main point, summed up in this magazine headline: Goodbye GDP Worship.
Chinas governments new economic growth target is seven percent a year, way down from the past five sizzling years, which averaged 11.2 percent annual growth.
Mr. ZHANG PING (Senior economic planner): (Foreign language spoken)
LIM: Senior economic planner, Zhang Ping, summed it up: its no longer about growth at all costs, but better growth; more money in peoples pockets; and a move away from exports towards growth driven by domestic consumption.
Making this happen could be hard because of conflicting goals.
China Merchants Bank chairman, Ma Weihua, spelled out his doubts to NPR.
Mr. MA WEIHUA (China Chairman, Merchants Bank): (Foreign language spoken) (Through Translator) Local governments want fast development to increase their revenues and improve peoples lives. But nationally, over-fast development could harm stable development and increase inflation.
LIM: In fact, 25 out of 31 of Chinas provinces have set double-digit economic growth targets for the next five years. Of the delegates at the conference, few want slower growth in their own backyards.
Chen Xitao from Anhui province is typical.
Mr. CHEN XITAO: (Foreign language spoken) (Through Translator) The report just states a goal. I should say that our province is less developed. Our growth will definitely be faster than seven percent.
LIM: There are other problems too: rising incomes could lead to more inflation, which directly contradicts another policy aim of beating inflation. And slowing growth threatens vested interests. Chinas state-run media says these new targets could challenge officials and even test their ability to govern.
Louisa Lim, NPR News, Beijing.
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