In the past 30 years of reform and opening up, we have made great achievements. China has changed from a poor, backward and closed country into a modernized well-off country. China has become the third largest economy in the world, and its international influence is increasing day by day. In the past 30 years, the face of China has undergone fundamental changes. The world has paid attention to China's extraordinary achievements, but many people in the world are jealous of the rise of China. The rise of China is really changing the global economic structure, so some people will feel a little uncomfortable. But I don't think anyone can stop China's progress.
In the prosperous Tang Dynasty, China was the center of the world. At that time, China's GDP was much larger than that of the United States today, accounting for more than 40% of the global GDP. After a thousand years, China has finally ushered in a new period of prosperity. This is entirely due to the correct path we have taken in the past 30 years of reform and opening up. We are an economic power now, but becoming an economic power is not our goal. I believe that China will definitely become an economic power, even a very powerful country in all aspects. We have the ability and wisdom. In the process of transforming from an economic power to an economic power, we will certainly encounter many difficulties. Today, China's economic development has entered a new round of adjustment period, and we will face more complicated contradictions, some of which have not been encountered in the past 30 years of reform and opening up. The State Council, the CPC Central Committee, attaches great importance to the new problems and contradictions in the process of China's reform and development, grasps the overall situation, sizes up the situation, constantly adjusts policies and resolves contradictions, so China's economy and society are still developing in a good direction.
1. China is in a period of rapid economic growth.
Since the beginning of this year, China's economic growth is still very fast. At the beginning of the year, the government work report stated that in 2008, China's economic growth rate remained at 8%, and CPI (Consumer Price Index) rose by 4.8%. This is very robust, and it is understandable that it may exceed this index in the actual implementation process. Judging from the economic operation in the first half of the year, our economic growth remained at 10.4%, which was lower than last year's1/0/0.4%. CPI rose by 7.9% in the first half of the year. On the whole, the price rise has been contained and the economy is still running at a high speed.
China is currently in the middle stage of industrialization. To become a modern country, it must go through a long period of industrialization. For a country like China, there is no modernization without industrialization. Without modern manufacturing and modern core equipment enterprises, how can we become an economic power? We should promote industrialization and make up the course of industrialization. China came from an agricultural society, or a society in which the agricultural economy dominated. Generally speaking, our level of industrialization is still backward. The backward level of industrialization will bring many problems, including social order and modern ethics, which are lacking. Therefore, industrialization is a comprehensive index, which constantly promotes economic development and can bring about all-round social progress. Social progress is our fundamental goal. Now we are still in the middle and late stage of industrialization, and a basic feature of this period is rapid economic growth. The modernization process of Japan and South Korea has experienced rapid economic growth for ten or even twenty years. Without the rapid economic growth in these ten or twenty years, there would be no Japan and South Korea today. China is also going through this process, and China's economy is much larger than then. Since 2000, China's economy has entered the take-off stage, and our rapid economic growth will be maintained until 2020. By then, China will surpass Japan, and its economy should be equivalent to that of the United States. We will probably surpass Japan in 20 12 and become the second largest economy in the world. It will take us another eight years to approach the level of the United States in terms of economic aggregate. Of course, some American economists believe that China's economy will surpass that of the United States in 2028. This is optimistic. Therefore, our economy will continue to grow. In the process of sustained growth, it is necessary to adjust economic policies in time to enhance the economic structure and industrial competitiveness.
Second, the core issues facing China's macro economy at present
China is now the third largest economy in the world. By the end of this year, the per capita GDP will reach 3,000 US dollars, which is close to the level of middle-income countries. Generally speaking, especially in a country with a large economy, the per capita GDP is 3,000 US dollars, which means that the economic structure of this country needs to be upgraded and the industrial structure needs to be greatly adjusted. In the process of economic restructuring and industrial upgrading, the relationship between inflation, economic growth, employment and the development of small and medium-sized enterprises is a problem that must be faced squarely. This is like the first economic system reform and market economy development in China in the early 1990s, which brought shocks to many state-owned enterprises at that time. Thanks to the correct direction and proper policies, we were lucky to get through the difficulties. Now that we have entered a new era, what should our small and medium-sized enterprises do? How does this policy balance inflation and economic growth?
The adjustment of economic structure includes two aspects, namely, structural upgrading and industrial transfer. China's coastal areas and economically developed areas should be places where high-tech industries and modern industries develop. In the process of industrial upgrading, labor costs are also increasing, which brings challenges to labor-intensive industries.
We are in the period of comprehensive adjustment of economic structure and are facing many complicated problems. But the core issue is the relationship between maintaining sustained and stable economic growth and controlling inflation. Under normal circumstances, moderate inflation can drive economic growth, but if it is not handled well, it may make the economy enter stagflation. I think that when inflation exceeds 7%, controlling inflation should be the most important goal of economic policy. However, controlling inflation cannot excessively damage the foundation of sustained economic growth. Maintaining sustained and stable economic growth remains our top priority. Never think that just because China is a high-income country or a developed country, it can temporarily put aside its development and consider other issues.
We should fully realize that the inflation in China this year is different from that in the 1980s and 1990s. This year's inflation has two important characteristics: first, imported inflation, mainly the continuous rise of commodity prices, especially the rise of oil prices, has had an important impact on the overall price increase. Oil price is the benchmark of energy price, and oil is the king of resources. Its price increase will surely be passed on to China. China is an open country, and our demand for oil is very great. 50% of our oil is imported. Recently, the oil price has dropped from 147 USD per barrel to around 120 USD. The sharp fluctuation of oil price makes the world economy enter a period of sharp fluctuation, and the risk increases sharply. Although oil prices are falling now, high oil prices are still the basic trend, and this high oil price is related to the US dollar. We adopt a tight monetary policy, such as tightening the renminbi and tightening liquidity, so it is difficult for oil prices to fall. Textbooks say that by tightening the currency in circulation, the demand for goods can be reduced, thus lowering prices. Textbooks also say that inflation is a monetary phenomenon. In the final analysis, it is too much money that leads to rising prices. However, as far as oil prices are concerned, it is not the renminbi that has been issued too much, but the dollar that has been issued too much. Therefore, the United States has a great responsibility for the global economic turmoil, especially in the derivatives financial market. Why did China rise? The rise of China will change the global financial order and monetary system. Now the world uses the US dollar as the settlement currency and reserve currency, so the United States has been issuing currency. If RMB becomes an international reserve currency that can replace the US dollar in 20 years, it will play an important role in maintaining the stability of the global financial system and the global economic system.