Download New Pattern of Chinese Economy in the Next Five Years

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New Pattern of Chinese Economy in the Next Five Years
TAO Xinghui
School of Economics and Management, Tongji University, China, 200092
[email protected]
Abstract: the next five years is that China's "the 12th Five-year Plan", that is, from 2011 to 2015. In
these five years, what changes will China's economy happen? Future new patterns, several measures
must do improvement of foreign trade and advancing the reform of RMB exchange rate and promote
free trade zone.
Keywords: New pattern, China's economic, Measures
1 Introduction
In the next five years is China's "the 12th Five-year Plan", that is, from 2011 to 2015. In these five years,
what changes will China's economy happen? In China's economic development has been with three
wagons support, that is, consumption, investment, export. "The 12th Five-year Plan" Planning key
indicates that you want to change the mode of economic growth in China, this comprehensive periodical,
network, some of the views in the newspapers, in conjunction with our own thoughts, proposed a new
pattern of China's economic development of the next five years.
2 Measures
2.1 To begin, we must make improve in the foreign trade. First, on the production, we further reduce the
processing trade. Secondly, we improve the product structure. Increasingly high labor costs in China,
China cannot simply on labor-intensive enterprises, and China tries to improve the product structure.
Implementation all social products two large classes of structure in the, means of proportion has rose of
trend, and means of subsistence of proportion is has decline of trend; in means of subsistence in the,
food of proportion has decline of trend, and commodity of proportion is has rose of trend; in social
products of sector structure in the, agricultural products of proportion has decline of trend, and industrial
products of proportion is has rose of trend; in agricultural products in the, subsistence sexual products
(as food) of proportion has decline of trend, and commercial products (as cash crops) of proportion is
has rose of trend. However, do not reject other with relative stability of the product structure; generally
remain in a certain proportion of the various parts of levels. Various different products structure
influences each other, mutual constraints. Any change in the product structure has certain limits. Under
Socialist conditions, to rationalize the product structure, need based on the product development trends
in the structure of consciousness adjustment. Thirdly, regional structure: China trade should include not
only of Europe, America and Japan, but should go further to these places go to Africa, Latin America
and Southeast Asia. IV Encouraging "go out". Foreign investment is not blind, it is necessary to avoid
barriers to trade, expanding the size of the market, absorb advanced management technology, but also
good to "go". First, in a more market-oriented, more open, more interdependent world, the State must
take into account, via macro-influence and the long-term development of strategic importance to foreign
investment, improving the position of countries in the global economy, in the international allocation of
resources for a more favorable situation and improve relations with relevant countries and regions.
2.2 China's emergence as the "world factory", over 70% foreign trade dependence degree of cases,
countries must be taken into account by improving the quality and expanding foreign investment two
wheels, proactively in a wider space for industry structure adjustment and optimization of resources
allocation. While maintaining the advantages of manufacturing, to high value-added industrial chain
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links, enhance China's role in the international division of labor. Third, both manufactured products
from China in the world, or of their industrialization and modernization needs, you must consider how
to proactively through foreign investment from global access to capital, technology, marketing, strategic
resource. IV, in the case of foreign-funded enterprises into China, heavily share market in China, China
must take into account the development of new space. In foreign-invested company came at the same
time, China has the strength of enterprises "go", the respective advantages, "you beat you, I called my",
which is an inevitable reality. V, in transnational corporations use their strength, while restructuring
China advantage, Chinese enterprises with actual strength should also use the opportunity of adjustment
of industrial structure of transnational corporations, with their own comparative advantages of
restructuring their industries and enterprises, active participation in international cooperation and
competition, to gain market share and technology development capabilities. In this process, strengthen it,
training and match the economic power of transnational corporations.
What’s more, promoting the reform of RMB exchange rate, grasp the USD and RMB's exchange rate,
and ultimately of RMB internationalization. We should develop an exchange rate target zone, not to
interfere in the exchange rate lower, and when to limit the use of means of intervention. Appreciation of
the renminbi is not simple, but to enhance it flexibility, depending on the demand and supply plan or
changes in the world economy increased flexibility. RMB internationalization has the following benefits:
first, improving China's international status, enhance China's influence on the world economy. Dollar,
euro, Yen and other currencies was able to act as the international monetary, is the United States, the
European Union, Japan economic strength and international credit status more fully reflected. After the
internationalization of renminbi, China has the power of a world currency issuing and regulating, on the
impact of global economic activity and the right to speak will increase as well. Meanwhile, the
Renminbi has a place in the international monetary system, you can change the current status of being
dominated; reduce the adverse effects of the international monetary system to China. Second, we reduce
the risk of exchange rate, promoting the development of international trade and investment in China.
Foreign trade and the rapid development of foreign trade enterprises hold large amounts of foreign
currency claims and debts. Larger currency exposure risk, currency fluctuations can have a certain
impact on enterprise operation. After the RMB's internationalization, foreign trade and investment in
local currency-denominated and settled enterprises face exchange rate risk will decrease as well, which
can further promote the development of China's foreign trade and investment. At the same time, we will
also promote the development of RMB-denominated bonds and other financial markets. Third, further
promote the development of frontier trade in China. Border trade and tourism entities such as the
economic cross-border RMB cash flows that occurred, to a certain extent alleviate the lack of means of
settlement in bilateral exchanges, promote and expand bilateral economic and trade exchanges,
accelerating border economic development in minority areas. In addition, many neighboring countries
were countries rich in natural resources, market shortages, in stark contrast with the Chinese. Outside
currency outflow, which ease the shortage of natural resources in China, market oversupply beneficial.
IV, we get more international mint income. Most directly after the internationalization of renminbi,
maximum benefits are access to international mint income. mint is the Publisher, by virtue of the
privilege of issuing currency notes obtained by the difference between the cost of issue and
denomination notes issued. In their release notes, we had taken from the national to the country. Issued
world currency equivalent of mint taxes from other countries, this income is basically no costs.
2.3 We should promote free trade zone. So, I would like to "the 12th Five-year Plan" we should put "the
12th Five-year Plan" the trade balance, improve trade structure, product mix and historical structures,
encourage enterprises to "go out", further improve the RMB exchange rate reform, promote regional
polarization had a lot of progress. Set free trade area of role main is:
using its as commodity
distributed Center of status, expanded export trade and re-exports trade, improve set national and area in
international trade in the of status, increased exchange income;
conducive to attract foreign,
introduced abroad advanced technology and management experience;
conducive to expanded labor
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employment opportunities;
in port, and traffic hub and border area set area, can up to prosperity port,
and stimulation is located country traffic transport development and promote border region economic
development of purpose. Set the effects of free trade zone there are two main classes: one Member
refers to the region between the Elimination of tariff and trade measures to limit the number of direct
members after the impact of trade development; second class refers to the after the conclusion of the
FTA, due to increased productivity and capital accumulation in the region, the indirect effect of causing
members faster economic growth. Both were also referred to as static and dynamic effects. (1) Effect of
static: static effect in the effects of the most representative is the so-called "trade creation effect" and
"trade diversion effect". Members of the trade creation effect in the major regional falling transaction
costs and trade restrictions between cancel each other, resulting in the domestic high cost product to be
replaced by other members of the regional low-cost goods, as well as past each other and high tariffs
limit to the number of its low-cost merchandise exports expanded, giving the region more trading
opportunities and economic benefits to the export and import sides. "Trade diversion effects" refers to
the original and regional external trade between countries, due to the reduction of transaction costs in
the region may be replaced by trade in the region between members. (2) Dynamic effects: dynamic
effects include "market expansion effect" and "promoting competition effect". The former refers to as
the expansion of trade, will result in a scale of production and circulation, and bring about industrial
cluster effect. The latter refers to as the formation of regional unified market, will promote competition
in the monopoly industries in the region, and improve production efficiency. Trade creation effect,
market expansion effect and promote competition impact many positive effects, but may also negatively
impact the trade diversion effect, due to the low-efficiency products in the region likely to replace
members of the non-efficient products. In General, require a member of the absorption efficiency and
expanding the regional coverage is only possible to prevent the negative effects.
3 Conclusion
China should play the role of foreign trade and the promotion of foreign trade in China's economic
development, but also to moderate expansion and improvement of foreign trade situation. "the 12th
Five-year Plan" we should put consumer to first place, second place in the export to, and investment to
third place, increase people's purchasing power, so that they can, willing to consumption, improve their
standard of living so that they dare to consume, provide appropriate products for their willingness to
spend. And do the measures mention above, China's economic development of the next five years will
certainly render a new pattern.
Author in brief:
Tao Xinghui, Tongji University, school of Economics and management graduate, France
ESCP-EUROPE business school graduate.
Email: [email protected]
Tel: 13,761,022,880.
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