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Consuming changes

Overview

Consumption in China has not only failed to keep pace with either investment or exports; it has fallen overall as a proportion of GDP since 2000 from 62.3 per cent to 51.9 per cent, while gross capital formation rose from 35.4 per cent of GDP in 2000 to 42.6 per cent in 2005. This trend needs to be reversed and the share of consumption increased if the economy is to be rebalanced on a more sustainable basis with reduced reliance on fixed asset investment.

In urban areas, the...

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