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Boosting consumption has become a hot word for the Chinese economy. People are expecting the issuance of the 12th Five-Year Plan of Domestic Trade, which is considered the general guideline of boosting consumption.
Jiang Zengwei, Vice Minister of Commerce and Fang Aiqing, assistant to the Ministry of Commerce, are the two major officials in charge of domestic trade. In the recent two months, the two frequently reported the coming issuance of the first national-level 12th Five-Year Plan for domestic trade.
Prof. Ren Hongtao, dean of the Trade School at the Beijing Technology and Business University, is a member of the team of planning the development of domestic trade, said that the current depression of international economy and the unoptimistic exports situation of China decided that it was a crucial time for China to change its economic structure. It is impossible to dramatically increase the investment. In that situation, the government should attach more importance to boosting consumption.
The nationallevel domestic trade planning
The 12th FiveYear Plan for commerce consists of a general planning, three national-level plans for special industries and six ministry-issued plans. The “12th FiveYear Plan for the Development of Domestic Trade (2011-2015)” is one of the three national-level plans. Jiang Zengwei is the leader of the planning team.
The formulation about the first nationallevel planning about domestic trade is no longer a secret. The plan has been discussed and improved for a long while and the date of its issuance has been delayed from last October to this April and then to June, yet by now it has not come out. One of reasons to the “difficult production of the plan” is that the 12th FiveYear Plan about domestic trades covers a broad field of commerce and trade. At first the Ministry of Commerce is appointed leading unit of formulating this plan but then more and more ministries were added in till the final recruitment of the National Development and Reform Commission. These departments had to work together to discuss and improve the plan, which undoubtedly costs a long time.
According to the information that has been revealed, in the 12th Five-Year Plan, the Ministry of Commerce paid closer attention to the balance between domestic and foreign trade as the ministry in charge of domestic trade. Yao Jian, former spokesman for the Ministry of Commerce, said that China would list the development of service as an important target in the 12th Five-Year Plan. The Ministry of Commerce will takes measures to improve the weight and size of domestic consumption, trade, production and logistics in service and increase the employment size of the domestic trade industry.
Prof. Shen Jianming from the University of International Business and Economics said that the 12th Five-Year Plan for domestic trade enhanced the openness of domestic trade and put forward clearer goals of domestic trade development. It requires more importance attached to the trade within China and promotes the integration of international and domestic trade. In addition, the plan also has great promotional effect for the development of private companies by giving them a larger space to exert their power.
To unburden the circulation industry
Presently, the world is suffering a low economic growth rate, which is accompanied by the continuous depression in the international trade market. Correspondingly, the growth of exports and imports trade of China also went through a drastic decrease. Meanwhile, influenced by the national macroeconomic control, the investment in fixed assets is still on the decreasing trend.
According to the half-year financial data, consumption always kept a stable development pace and gradually became the first engine to drive economic growth of China among the three “carriages” (consumption, investment and export). However, apart from the negative fac- tors like the overlarge income gap, some hurdles found in the domestic demand also became the handicap for expanding consumption. The 12th Five-Year Plan about domestic trade is just to address these problems.
According to Jiang Zengwei, there are five points put into consideration in terms of the planning of domestic trade, which are how to expand the consumption, how to improve the development of circulation enterprises, how to change the marketing method, how to improve the market environment and order and how to help market players improve themselves and adapt to the market. The last point includes how to grow and enhance emerging business patterns in retail industry based on modern organization, management and circulation methods.
The first point is the most important. According to Zhao Ping, deputy director of the Consumption Economy Research Department at the Research Institute of Ministry of Commerce, the Chinese government launched a series of policies to heighten residents’ desire of consumption after the financial crisis. Driven by these policies, consumption indeed had a drastic increase in the past few years. However, when these policies became invalid, the growth of some kinds of consumer goods had obviously decreased.
It is known that the 12th Five-Year Plan about domestic trade will not list detailed measures of boosting consumption, but it will fix the orientation of boosting consumption and improving domestic demand, like reducing the burden of circulation industry, reducing the ttax of retailers and so on.
Zhao Ping said that China needed to improve and multiply the methods of supporting consumption-related policies, such as properly changing the consumption tax of cars, cosmetics, jewelries and so on. The Chinese government also needs to lower the imports tariff of luxury goods and attach importance to service consumption like aged care and maternity matron.
In addition, the consumption situation and the imbalance between urban and rural areas in the domestic market have already stood in the way of expanding consumption. The possible solutions to these problems are also listed in the 12th Five-Year Plan about domestic trade.
Jiang Zengwei, Vice Minister of Commerce and Fang Aiqing, assistant to the Ministry of Commerce, are the two major officials in charge of domestic trade. In the recent two months, the two frequently reported the coming issuance of the first national-level 12th Five-Year Plan for domestic trade.
Prof. Ren Hongtao, dean of the Trade School at the Beijing Technology and Business University, is a member of the team of planning the development of domestic trade, said that the current depression of international economy and the unoptimistic exports situation of China decided that it was a crucial time for China to change its economic structure. It is impossible to dramatically increase the investment. In that situation, the government should attach more importance to boosting consumption.
The nationallevel domestic trade planning
The 12th FiveYear Plan for commerce consists of a general planning, three national-level plans for special industries and six ministry-issued plans. The “12th FiveYear Plan for the Development of Domestic Trade (2011-2015)” is one of the three national-level plans. Jiang Zengwei is the leader of the planning team.
The formulation about the first nationallevel planning about domestic trade is no longer a secret. The plan has been discussed and improved for a long while and the date of its issuance has been delayed from last October to this April and then to June, yet by now it has not come out. One of reasons to the “difficult production of the plan” is that the 12th FiveYear Plan about domestic trades covers a broad field of commerce and trade. At first the Ministry of Commerce is appointed leading unit of formulating this plan but then more and more ministries were added in till the final recruitment of the National Development and Reform Commission. These departments had to work together to discuss and improve the plan, which undoubtedly costs a long time.
According to the information that has been revealed, in the 12th Five-Year Plan, the Ministry of Commerce paid closer attention to the balance between domestic and foreign trade as the ministry in charge of domestic trade. Yao Jian, former spokesman for the Ministry of Commerce, said that China would list the development of service as an important target in the 12th Five-Year Plan. The Ministry of Commerce will takes measures to improve the weight and size of domestic consumption, trade, production and logistics in service and increase the employment size of the domestic trade industry.
Prof. Shen Jianming from the University of International Business and Economics said that the 12th Five-Year Plan for domestic trade enhanced the openness of domestic trade and put forward clearer goals of domestic trade development. It requires more importance attached to the trade within China and promotes the integration of international and domestic trade. In addition, the plan also has great promotional effect for the development of private companies by giving them a larger space to exert their power.
To unburden the circulation industry
Presently, the world is suffering a low economic growth rate, which is accompanied by the continuous depression in the international trade market. Correspondingly, the growth of exports and imports trade of China also went through a drastic decrease. Meanwhile, influenced by the national macroeconomic control, the investment in fixed assets is still on the decreasing trend.
According to the half-year financial data, consumption always kept a stable development pace and gradually became the first engine to drive economic growth of China among the three “carriages” (consumption, investment and export). However, apart from the negative fac- tors like the overlarge income gap, some hurdles found in the domestic demand also became the handicap for expanding consumption. The 12th Five-Year Plan about domestic trade is just to address these problems.
According to Jiang Zengwei, there are five points put into consideration in terms of the planning of domestic trade, which are how to expand the consumption, how to improve the development of circulation enterprises, how to change the marketing method, how to improve the market environment and order and how to help market players improve themselves and adapt to the market. The last point includes how to grow and enhance emerging business patterns in retail industry based on modern organization, management and circulation methods.
The first point is the most important. According to Zhao Ping, deputy director of the Consumption Economy Research Department at the Research Institute of Ministry of Commerce, the Chinese government launched a series of policies to heighten residents’ desire of consumption after the financial crisis. Driven by these policies, consumption indeed had a drastic increase in the past few years. However, when these policies became invalid, the growth of some kinds of consumer goods had obviously decreased.
It is known that the 12th Five-Year Plan about domestic trade will not list detailed measures of boosting consumption, but it will fix the orientation of boosting consumption and improving domestic demand, like reducing the burden of circulation industry, reducing the ttax of retailers and so on.
Zhao Ping said that China needed to improve and multiply the methods of supporting consumption-related policies, such as properly changing the consumption tax of cars, cosmetics, jewelries and so on. The Chinese government also needs to lower the imports tariff of luxury goods and attach importance to service consumption like aged care and maternity matron.
In addition, the consumption situation and the imbalance between urban and rural areas in the domestic market have already stood in the way of expanding consumption. The possible solutions to these problems are also listed in the 12th Five-Year Plan about domestic trade.