On January 28, National Bureau of Statistics head Ma Jiantang said the central government will scrutinize local GDP figures by using a unified calculation to prevent provinces from faking their economic figures.

The central government's move shows it is serious about transforming the form of China's economic growth, Zhuo Yongliang, director of Zhejiang Province's Development and Reform Research Institute, said.

"Governments should use guidance to tackle structural problems like the imbalance between domestic and external demand and imbalances between the industrial and service sectors."

The current economic downturn prompted by the global financial crisis highlighted many structural problems, and no local government can turn a blind eye to them, Zhao said.

As local legislature meetings are held across the country, he foresaw more powerful and concrete action being taken by the local governments.

In some regions, a desire for more sustainable growth was evident even as the national economy weakened rapidly last year. Drastic action was taken in Shanxi Province, for example.

Shanxi's major industry, coal mining, was restructured to close smaller collieries. Consequently, Shanxi's economy contracted 4.4 percent in the first half of 2009. For the whole year, the province's GDP grew 6 percent, 2.7 percentage points lower than the national average.

Hu Angang, director of the Center for China Study at Tsinghua University said the transformation is crucial.

"A raft of uncertainties will hit China if it doesn't change its model of economic growth to something more rational and environmentally friendly," he said.

Key to the model of growth transformation, as the effect of the 4 trillion yuan (US$586 billion) fiscal stimulus package wanes, is private investment, some scholars have noted.

Jia Kang, director of the Institute for Fiscal Science Research at the Ministry of Finance, said private investors are still not active but are less jittery than they were at the height of the economic downturn.

"Of course, it is too early to say private investment has revived," Jia said.

Continued weak global consumption could still take a toll on growth engines like the export-oriented Pearl River and Yangtze River deltas.

"China's recovery is not yet firm," said an analyst in Zhejiang's Yiwu City, home to the world's biggest small commodity market. "Globally, the economic recovery has not spurred a full revival of consumption."

Analysts said demand for Chinese exports may not see significant improvement for three years as US-style credit-based consumption may be gone forever.

(Xinhua News Agency February 2, 2010)