Economy

GDP surge can have drawbacks

By Li Woke (China Daily)
Updated: 2011-02-01 09:33

Fast growth in western, central areas consumed their resources

BEIJING - Although economic growth in China's central and western provinces increased dramatically last year, experts warn that the fast pace may not be sustainable.

Gross domestic product (GDP) in Southwest's Sichuan province increased 15.1 percent last year to 1.69 trillion yuan ($256 billion), compared with 2009, while the GDP of North China's Inner Mongolia autonomous region jumped to 1.16 trillion yuan in 2010, the National Bureau of Statistics (NBS) said.

A shipbuilding site in Sichuan province. China's western provinces have seen faster growth rates than their east coast counterparts. [Photo/China Daily]

Experts say that fast economic growth might not be good for sustainable development.

"Fast growth in the central and western provinces resulted mostly from their rich resources, such as coal and crude oil," said Xu Fengxian, a research associate at the Chinese Academy of Social Science. "The growth pattern comes at the cost of environmental devastation."

Encouraged by last year's strong economic growth, many provinces set even higher targets for the future.

According to local five-year plans, the southwestern municipality of Chongqing has targeted an annual growth rate of 12.5 percent in the next five years and plans to achieve a GDP in 2015, double that of 2010.

The Inner Mongolia autonomous region and the southwestern province of Guizhou have set their economic growth rates as high as 13 percent for this year.

East China's Anhui province, South China's Guangxi Zhuang autonomous region and Northeast China's Heilongjiang province also plan in 2015 to double their GDP from that recorded in 2010.

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Experts attribute local governments' eagerness to attain high growth rates to the fact that the central government sees GDP growth as a key indicator of local officials' achievement and worthiness for promotion.

NBS data show that China's GDP growth jumped 10.3 percent last year, rebounding to double-digit growth within three years of the global economic crisis, and the country's GDP has expanded more than 90-fold over the past 30 years, driven mostly by exports and government investment, not consumption and advanced technologies.

"We should develop new economic growth points and promising industries that do not rely largely on resources but are more dependent on technology," Xu said.

The National Development and Reform Commission, China's economic planning body, has said it will try to slow the country's economic growth over the next five years and has lowered the national target to a more modest 8 percent for 2011.

"China's main aim in the next five years is to slow its economic growth," Xu said.

"Maintaining fast economic growth would require traditional resources-dependent development to continue," he said.