China’s Middle Class Population To Jump To 600 Mln. By 2020
11/3/2012 9:49 AM ET
China’s rapid urbanization will push up its number of middle class people to 600 million and support an annual seven to eight percent economic growth by 2020, the chief of a government think tank predicted on Saturday.
Speaking at a reform forum in Haikou, capital of the southern-most Hainan province, China Institute for Reform & Development Executive President Chi Fulin said as urbanization would create huge domestic demand potential, “China still has ample room for transition and reform for the coming decade.”
According to him, China’s urbanization rate has reached 51.3 percent in 2011, that meant over half of the nation’s 1.3 billion population were living in cities and towns last year.
As more farmers are leaving their farmland and becoming migrant workers in cities and towns, China is expected to have another 200 million migrant workers living in urban areas, state-run Xinhua news agency reported quoting a study by the Institute.
Continued urbanization and the increase in middle class consumers will spur investment demand by at least 40 trillion yuan ($6.3 trillion) over the next ten years, Chi said.
He predicted that domestic consumption would replace investment to become China’s major engine driving the economy, with residential consumption in rural and urban areas expected to jump to 30 trillion yuan in 2016 from 16 trillion yuan last year.
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