Sweeping Economic Change to Take 5 Years or More

Critical success factors

The critical success factors in China effecting economic transformation are mechanisms to encourage the commercial success of innovation, such as better intellectual property rights laws and enforcement, Kuhn said.

Echoing Kuhn, Wang Jun of the CCIEE expected the key in transforming the economic development model to lie in a series of mechanism reforms.

"All mechanisms should be designed and adjusted to facilitate the transformation of economic development models, rather than just aiming to produce fast and large-size gross domestic product (GDP)," said Wang.

The reforms should take place in the finance and taxation system, the system for assessing the performance of local governments and officials, income distribution system, the pricing mechanism of natural resources and environmental protection mechanism, said Wang.

Kuhn also stressed the role of an improved social system under which consumers would have confidence in healthcare and retirement which would enable them to spend more, thus driving the domestic economy.

"It takes time to change all the current mechanisms which are results of long-term development, so transforming the economic development pattern is a long-term task, not only a goal for the next five years, but also for the next whole decade or even two," said Wang.