New drivers of growth get route for success

Consumption boost will provide engine for further expansion and more choice

A more mature market will boost consumption of food, clothes, housing, travel and other services, and enhance residential consumption and nurture new economic growth drivers, according to a recent guideline.

The guideline strives to meet growing and diverse demand by ensuring economical and safe supplies for basic consumption, cultivating a mid-and high-end consumption market, and developing new drivers.

The guideline was adopted at a meeting of the Committee for Deepening Overall Reform of the CPC Central Committee on July 6 and released jointly by the general offices of the CPC Central Committee and the State Council, China's Cabinet, on Sept 20.

The document targets a smoother cycle in which the upgrading of consumption leads to supply innovation, which in turn will improve consumption growth to realize a better balance between supply and demand.

In the real estate sector, the rental market should be promoted, especially long-term rentals in large cities with a net inflow of population. Information and green consumption are also encouraged to increase quality and competitiveness of products and services - smart cars and service robots for example. Consumption quality should be improved and upgraded in culture, tourism, sports, healthcare, house maintenance and educational services.

Meanwhile, rural residents are encouraged to spend more in areas such as telecommunication, culture and entertainment and automobiles, while e-commerce services will expand their network in rural areas, where infrastructure will be improved to reduce logistics costs.

The document was the latest move to promote residential consumption, which contributed 58.8 percent of economic growth last year. The number was nearly 4 percentage points higher than that in 2013, according to the Government Work Report delivered by Premier Li Keqiang in March.

The economy has shifted from one focused on investment, export and consumption, to a mainly consumption-driven one, and the guideline provides guidance on what consumption should be promoted for the country's long-term and healthy development, said Zhu Lijia, a professor of public management at the Chinese Academy of Governance.

In the first half of this year, consumption expense per capita in urban areas hit 12,745 yuan ($1,870), seeing an increase of 6.8 percent compared with the same period last year, according to the National Bureau of Statistics. The average expense in rural areas was 5,806 yuan, up by 12.2 percent.

"When you see such increases in expenses and the guideline together, there is a great potential for China's individual consumption, which can be partially exemplified by the large amount of products bought from overseas and the rocketing box office for some superb movies," Zhu said.