The next year leadership transition in China is discussed alongside a 5 year government priorities. Inflation is the main task to manage, however further rapid, 7% average annual economic growth and attempts to increase domestic consumption make the primary goal hardly achievable.
Pledges to keep economy growth are common for all politicians. Has anybody promised differently and is the quantity more appreciable that quality?
It is certainly true that inflation caused by imported goods could be reduced by developing effective domestic industries. However, despite of efforts to ease dependence on imports in China, the structural inflation will come into force. The government have set a 16 % growth target for M2 in their plans to stimulate local consumption. So, that even higher inflation and greater social dissatisfaction may be expected.
On the other side the statement to improve the distribution of the benefits gathered from growth evokes curiosity. What are the preferences of capital allocation?
About Me
- Asta Pravilonytė
- Every manager can call him or herself a good strategist if he or she only works within an environment that is favorable; however, it is only in times of stress that one truly learns what one's capabilities are!
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