New growth drivers crucial to development

One of the major characteristics of economic giants is that they must provide a huge domestic market and have a huge supply capacity to support and spur external circulation. After 40 years of reform and opening-up, China has experienced rapid economic growth, and the foundation for internal circulation has gradually improved.

The country has become the world's largest market that has the greatest demand potential, with a total population of 1.4 billion and more than 400 million middle-income earners. Its massive domestic market keeps expanding, as the country is heading toward becoming a high-income country, Liu said in the article.

China will boost consumption comprehensively, foster new types of consumption and develop consumption of services. The country will allow investment to play a key role in optimizing the structure of supply, expand the space of investment, promote the upgrading of business equipment and technology innovation, and push for the development of a batch of major projects.

Besides, the government will also promote a new type of urbanization and coordinated urban and rural development. As the circulation of urban-rural economy is an important part of domestic circulation, China should give full play to key cities and city clusters, implement major regional strategies and build modern city areas, to form new drivers of growth.

While pushing ahead with supply-side structural reform, the country will further promote demand-side reform, which includes expanding domestic demand, promoting consumption and enlarging investment.

At the meeting of the Political Bureau of the CPC Central Committee, top leaders urged efforts to solve economic problems, shore up weak links of the economy, create a dynamic equilibrium between supply and demand, and improve overall effectiveness of the national economic system.

With a series of supply-side structural reforms, such as reducing excess capacity, environmental protection, deleveraging and the upgrading of supply chains, China will significantly improve the efficiency on the supply side and generate demand through higher levels of supply. To achieve this goal, we should make moves to inspire the potential of domestic demand.

As the domestic economy has gradually returned to normal in spite of uncertainties of the COVID-19 pandemic and the external environment, China will be under less pressure of stabilizing growth in 2021. Therefore, the intensity of our policies will be enough as long as they can ensure that economic growth will remain within a reasonable range.

Under these circumstances, the government will attach greater importance to restricting leverage ratios as well as preventing and controlling risks next year. The policies will be different from those launched previously while China was stepping up efforts to stabilize growth and employment.

However, unlike in 2018, deleveraging will not be one of the primary missions of the country next year, considering that China has achieved decisive results in winning the "three tough battles" of preventing financial risks, reducing poverty and tackling pollution.

The writer is chief economist at GF Securities.

The views don't necessarily reflect those of China Daily.