Experts say inflation worries have not yet formed a realistic pressure

With the strong stimulus of 4 trillion investment, China's economic stability and recovery has been basically established, but inflation expectations, overcapacity, the global "exit" sound makes the Chinese economic outlook is still full of variables. In the recent "2010 China Economic Prospects Forum", including the Ministry of Finance Science Institute director Kang, the State Council Development Research Center, Director of the Institute of Finance, Xia, a number of economists have suggested that inflation has not yet constituted a realistic pressure, should seize the opportunity to adjust the economic structure, expand domestic demand,　　Reduce dependence on foreign trade exports, while promoting the reform of resource prices. The State Council's executive meeting had disclosed information that the focus of macro-control in the next few months was to properly handle the relationship between maintaining a stable and rapid economic development, adjusting the economic structure and managing inflation expectations.　　This policy message makes investors more concerned about how the central government will "manage inflationary expectations". Although the State Council executive meeting put forward "managing inflation expectations", Kang pointed out that the word "expected" is very important, indicating that we have not yet faced realistic inflationary pressures. Recently, the Treasury announced the September fiscal revenue and expenditure, the monthly revenue growth of 33% per cent, back to the global financial crisis before the rapid growth.　　In Kang's view, revenue growth this year should be synchronized with GDP growth in nominal terms, which is expected to grow by 8% per cent a year. Some economists also argue that inflation may not be too much to worry about, as there are pressures to push up prices and to curb price increases. But some economists worry that rising food prices could be inflationary pressures in the future. "There is no need to worry about inflation driven by rising food prices and agricultural products. This possibility does not exist.　　"Han, Minister of Rural Research at the Development Research Center of the State Council at the Forum, said. Monitoring data show that in the first to three quarters of this year, the price of food and agricultural products continued to decline.　　Han said that since this year, the biggest pressure on the food market is the decline in prices, the country has to buy farmers by a large number of minimum protective price to stabilize food prices, to maintain farmers ' production will.　　Professor Guoqing of the National Development Institute of Peking University has also shown that the four-quarter price growth rate may be zero, or even negative, that is, small deflation.　　Although the stability of China's economic recovery has been basically established, but Xia pointed out that the global economic situation after the financial crisis has changed dramatically, China must throw away the illusion of U.S. consumer demand, to expand domestic demand, and effectively adjust the economic structure. "Americans cut back on consumption, which is the equivalent of a sudden reduction in the biggest consumer demand for countries that have relied on large exports to sustain growth." How can China restore the high growth of the past 9% to 10%? It is necessary to expand domestic demand.　　"Xia said. Before the global financial crisis, the trade surplus to China's GDP contribution rate of 35%, China's economic and trade dependence of 66%. As the global financial crisis has left consumers in Western countries clutching their pockets, Chinese exports have fallen sharply, with double-digit negative growth this year.。 Economic data from the first three quarters showed that the contribution of foreign trade to GDP was negative 3.6%.　　Manaslu, a professor at Peking University's Institute of International Development, said that imports and exports have contributed almost 0 per cent of China's GDP this year. "We should take the initiative to speed up economic adjustment in the context of maintaining a lower level of growth acceptable to Chinese society, without illusions." "Xia believes that the initiative to speed up the restructuring of the focus should be placed on the increase in consumption, to solve the" high savings, low consumption "problem.　　If consumption really can come up, the problem of overcapacity is also relatively good solution. An important measure of the Chinese Government's efforts to stimulate domestic demand is to start the "Home appliance countryside". But up to now, the effect of home appliances to the countryside is far from expectations. Han said that the departments concerned initially formulated three years of "home appliances to the countryside" target is 800 billion yuan in sales, and subsequently reduced two times to 300 billion yuan.　　In January-August this year, the household appliances sold in rural areas amounted to 32.6 billion yuan, at present, it is very difficult to reach 80 billion yuan a year. He revealed that the government's next hot spot for stimulating farmers ' consumption was housing for farmers. This year, the central government took out 4 billion yuan, in 23 provinces in the country to support farmers to rebuild a dangerous house, a subsidy of 10,000 yuan.　　Theoretically, only a prefecture-level city in Shandong Weifang, three years to start consumption of 30 billion yuan. Kang that, with China's economy not yet fully out of the doldrums, it is too early to talk about expansionary fiscal policy, and it is still necessary to continue to pursue expansionary fiscal policies for some time to come.　　But as monetary policy has been fine-tuned, fiscal policy needs to be fine-tuned and shifted to focus on economic restructuring. "Inflation has not yet formed a realistic pressure to tackle inflation at the moment, which gives us a very valuable window of time and a focus on using our economic instruments to promote structural optimization and development."　　"Kang said. In his view, the urgent task is to start resource price reform. Gradually straighten out the distorted Resource price system and promote the adjustment of resource tax relationship. "Fiscal policy must assume important responsibilities in the area of resource price reform."　　Kang said that in the previous few years has repeatedly discussed the resource tax reform, but has been unable to find the right time to start, and at the moment, should seize the opportunity. Although inflationary pressures are not obvious in the short term, inflation expectations still need to be addressed ahead of schedule. How monetary and credit policies are adjusted is one of the most public concerns. "The key is to keep the growth momentum of money and credit down smoothly next year, on the premise of maintaining basic stability and not causing ups and downs," he said. "Xia that credit should support 4 trillion investment projects completed. A moderately loose monetary policy to a sound monetary policy is unlikely to keep the credit scale of 9 trillion this year.