China should improve social
welfare to lower its high savings, a strategy to base the already
export-fueled economy more on domestic consumption, Nobel economics
laureate Joseph E. Stiglitz said Saturday.
Although China's high saving is envied by the rest of
the world, it is "too much to be good," Stiglitz said in Guiyang,
capital of southwest China's Guizhou Province.
High saving means China is dependent on export to keep
its economy growing, he said, adding that "one of the reasons that
people save so much is that they are worried about their
In recent years, Chinese residents' savings ratio
lingers above 40 percent, higher than the average savings ratio of
20 percent in developed countries. Meanwhile, China recorded a
sizzling economic growth of 10.7 percent in 2006, largely powered
by strong exports, which rose 27 percent to US$969.1
Stiglitz said to increase consumption and reduce
saving, China should improve its retirement program, health and
He also said that China needs to tackle the widening
gap between the rich and the poor to ensure "the sustainable
increasing of the GDP."
Having served as the economic adviser during the
Clinton administration and chief economist and senior vice
president of the World Bank, Stiglitz is now a professor at
Columbia University in New York and chair of Columbia University's
Committee on Global Thought.
(Xinhua News Agency March 11, 2007)