A visiting OECD senior official recognized China's efforts in dealing with the complexity of growing at a sustainable pace while trying to head off potential social problems, the Australian Associated Press (AAP) reported Monday.
Senior Organisation for Economic Cooperation and Development ( OECD) official Mario Pezzini said that China is putting in place industrial policy and other measures to increase productivity. " Without that, their income will not be able to grow at the same rate as it is now," Pezzini, director of the OECD's Development Centre told the local news service during his visit to Canberra on Monday.
At the same time, Chinese people are finishing work without a pension or the ability to deal with ill health in old age. As a consequence, China has to deal with social cohesion issues. "If not, you see what happened in Tunisia," Pezzini warned.
He said Tunisia's economy had been expanding at an annual rate of 5 percent for 10 years and had no debts. "Still, after 10 years of very intense growth there, there was the Arab Spring," he said.
Tunisia led a wave of uprisings across the Arab world that started in late 2010 and resulted in rulers being forced from power.
Pezzini said that means strong economic growth in China is not sufficient on its own. "So what this country is doing is dealing with very complex and difficult problems for sustainable growth," he said. The Chinese government is now targeting a growth rate of 7.5 percent, rather than the double digit growth rate that ruled for a number of years and provided a major lift for Australia's economy and mining sector, the AAP said. The OECD is due to release its interim economic assessment on Tuesday, an analysis of its projections since its Economic Outlook in May, but concentrating on the Group of Seven countries and China.