news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

This articleReprinted from:Contemporary Economics Foundation, Zhang Jun said

On July 16, Professor Zhang Jun published an article in Project Syndicate, discussing China's consumption rate and howEnsure the long-term growth of household disposable income. The original text is in English. We recommend the Chinese version translated by Professor Zhang Jun, and also attach the original English text.。

SHANGHAI—In May, the Biden administration accused China of flooding global markets with artificially cheap goods. This rhetoric is not new, and it is unlikely to disappear in the near future. However, in blaming China for overcapacity, these people ignore the fact that China’s net exports to the world have continued to decline relative to GDP since 2008, and its current trade surplus in goods has shrunk to less than 2% of GDP.

In recent years, China has been trying to reduce its reliance on exports by expanding domestic demand, while also promoting a rebalancing aimed at expanding household consumption and curbing further investment. However, although the share of labor compensation, which constitutes the main part of household disposable income, in GDP has continued to rise in recent years, from about 48% in 2007 to about 56% now, household consumption expenditure (share) remains stubbornly low. According to official data, total household consumption currently accounts for only about 38% of GDP. Compared with the share of about 60-70% in most countries, this figure in China is quite outrageous.