China's Growth Conundrum

In a recent press briefing following the annual meeting of the National People's Congress, China's Premier Wen Jiabao publicly stated that China's current growth pattern is unsustainable. Over the course of the two-hour talk that laid out China's 5-year plan for economic development, Jiabao stated that despite the country's overall average annual rate of growth of 11.2%

"We are keenly aware that we still have a serious problem in that our development is not yet well balanced, coordinated or sustainable."[emphasis my own]

That's right, China's leadership has admitted that despite prodigious growth - it's growth has not been sustainable.

Jiabo goes on to say "This manifests itself mainly in the following: growing resource and environmental constraints hindering economic growth…large income gap…an irrational industrial structure, continued weakness in the agricultural foundation…significant problems containing food safety."

In other words, growth - even remarkablegrowth - has not solved China's development problems. It has, in the case of the environment, even exacerbated some.

He goes on to say that the solution lies in making agriculture the foundation of the economy, expanding social programs such as education, and taking steps to conserve resources and protect the environment.

Although Jiabao stops well short of eschewing the growth paradigm, it is refreshing to have a world leader - one heading the world's second largest economy - admitting that when it comes to solving a country's environmental and social problems, when it comes to developing - the solution does not lie merely in more economic growth.

Photo Credit: lkiller123