News Analysis: How can China stay competitive?

Investing in Chinese people's heath and education will boost their productivity, and help China remain competitive in the future, said experts and officials attending the ongoing 14th World Productivity Congress.

China has a 1.3 billion population who can be both producers and consumers. Providing better education and medical services will make them more productive, said Khalid Malik, UN Resident Coordinator in China, at the congress.

In a productivity-based growth model, said Malik, "We not only consider labor productivity and energy efficiency", but also the loss of potential output from unemployed people and from people whose productive capacity is constrained by diseases or a lack of education.

Malik was pleased to see that China has vowed to build a harmonious society with more investment in health and education. For example, the government plans to provide free nine-year education to all children in rural areas by 2010.

China has become the world's fourth largest economy, but its per capita GDP only ranks 110th globally, official statistics show. China's GDP is five percent of the world GDP, yet it greedily and inefficiently consumes 25-40 percent of the world's crude coal, iron ore, steel, alumina and cement.

"China has become a big economic power. It is yet to become a strong economic power," said Xu Yifan, deputy director of the National Bureau of Statistics.

"With high energy consumption and low output, China finds itself at the lower end of the global value chain in the international division of labor," he said.

Xu said the country must improve the quality of people and enhance innovation capabilities.

Zhao Baige, vice minister in charge of the State Population and Family Planning Commission, said China's strategy is to transform itself from a country with a large population to a nation rich in human resources.

Jean Claude Lauzon, chairman of the World Confederation of Productivity Science, said he was confident China would remain competitive in the future, because Chinese young people are well-educated, open-minded, eager to learn and demonstrate a strong desire to do things better.

Source: Xinhua