By Li Hong, People's Daily Online

Signs have loomed large each passing day that large developing economies, typically China, would be a major engine powering the next global recovery. The reason why Chinese economy is looking to move independently from the developed ones is simple: the country's financial system is amazingly healthy, flush with funds; and its low workers' compensation system has guaranteed revenues flooding towards businesses and the government.

The World Bank forecasts that China's growth will hit 7.2 percent, the Organization for Economic Cooperation and Development foretells its rise to be 7.3 percent, and quite a few Chinese economists said the growth might top 8 percent this year. The momentum will cascade and accelerate to next year, with China's GDP probably precipitating past the single digits in 2010.

The developments are to iron nerves just months ago that the emerging giants could be among the biggest victims of the global financial crisis. The odds are also reassuring news for the developed economies reeling deep in recession. The variation between the emerging and the developed countries suggests that the once-popular theory of decoupling, that spares the emerging markets from a serious downturn in the developed economies, may make a comeback.

That said, some are still pouring cool water on Chinese economy. They allege that Beijing's strong policy stimulus would support its growth this year, but there is "a limit to how much and how long China's growth can diverge from global growth". They assert that China's government-influenced investment could hardly lead to a rapid, broad-based, full-fledgling recovery.

These pundits drew the conclusion on China's continuous weakness increasing exports to others' shores, and Beijing's "vulnerability" in billing more stimulus spending programs. The skeptics say that the country's policy stimulus, key to growth in 2009, simply cannot be as large as in 2010.

Actually, the slack in exports have been effectively made up with strong domestic consumptions. As consumers in Europe, Japan and the United States have been driven to the wall to save, Chinese families are going on a shopping spree, snapping up autos, electric appliances, clothes, mobile phones, utensils and now homes. That retail sale has been keeping a double digit expansion in the past five months, and housing value is in an upward spiral are two weighing reminders. With retail prices subdued and people's confidence about future running high, Chinese consumers are going to spend more.

Following up a nationwide promotion of rural collective medical insurance regime, Beijing has just jumpstarted another courageous plan – providing pensions to 10 percent of the country's rural aged folks by the end of this year. It will be extended to cover all rural pensioners in a few years. The reform is expected to inspire more spending by Chinese rural residents.

And, by curbing workers' wages to less than 15th of their Western counterparts', Chinese companies and governments at varied levels have access to bountiful profits and tax proceeds. While many firms and governments in the developed countries were running in the red, borrowing from everywhere, Chinese businesses and governments rarely hesitate to spend and expand investment.

In sharp contract to the developed countries, Beijing has more resources -- policy, unclogged banks, and the world's largest capital reserve – at its disposal. Chinese Premier Wen Jiabao has told the press that China has got "plentiful of bullets stored" for any additional stimulus if necessary. The relatively low-interest-rate policy alone has succeeded to pinpoint one direction: lend and spend.

The decoupling hypothesis is probably becoming true now. Somewhat in China's case, the theory's emergence is backed up by the country's low-wage policy, thanks to China's huge population base.