China released its 12th Five-Year Plan (FYP) in March 2011. The latest plan covers important issues such as infrastructure and the environment, and also aims to address rising inequalities while establishing the nation’s new short-term course.
The new FYP seems to have shifted the strategy from powerful investment and export-led growth to one that focuses more on the attractive domestic market. The Chinese government seems to be developing a stronger internal market with the boosting of employment, increase of wages and a considerable increase in the purchasing power of China's 1.3 billion consumers.
Former British Prime Minister Tony Blair – who has been to China 17 times since he left office – believes that China's new Five-Year Plan is very ambitious. “China aims to get 15 percent of its energy from non-fossil fuels by 2020. This is a big big change," Blair says.
Also according to him, "The biggest challenge (to meet the targets) is China's growth and its industrialisation is on a scale that the world has never seen before".
"China is changing in all sorts of ways... economically, but also socially, culturally and politically, I think it is also evolving," he says. "People want a green future, but a future with growth, jobs, a better life, prosperity."
Australia-China Relationship
Many opportunities lie ahead for Australian companies with China’s new FYP. With stronger buying power, Chinese consumers will need a vast array of services. This could open opportunity to well established Australian companies that have interest in the enormous Chinese market. Moreover, the Chinese government’s will to considerably reduce carbon emissions by 2020 opens opportunity for Australian businesses with expertise in the field.
Furthermore, China's top political advisor Jia Qinglin, chairman of the National Committee of the Chinese People's Political Consultative Conference, understands that efforts should be made to lift China-Australian business ties to a new level.
Jia said the two nations should also strengthen and expand trade in competitive products and enhance trade and investment cooperation in energy conservation, emission reduction, environmental protection, as well as green and low carbon industries.
According to Jia, the two nations should also encourage entrepreneurs to fully tap the potential for cooperation and consolidate the cooperation foundation with a view to promoting in-depth growth of bilateral business ties.
China’s future
Despite of the fact that the Chinese government decreased its target growth rate to 8 percent for 2011, the country’s main indicators demonstrate continuous growth. China has chosen a tangible decline from the double-digit growth registered in almost every year throughout the past decade with the main purpose of achieving more sustainable growth.
The focus now has shifted to developing a stronger domestic market. With over 1.3 billion people, China wants to ensure that workers have enough disposable income to keep its economy growing while shifting to less carbon emissions. With a strong internal market the country can secure growth and better life standards for years to come while reducing inequality.
For more information on doing business in China contact the International Trade Consultants at Australian Business Consulting and Solutions, or go to our International Trade website.