Top Chinese Economist Proposes National Consumption Target

Prominent Chinese economist Cai Fang has proposed that Beijing add a quantitative target for consumption growth to its long-term modernization goals. He argues this is necessary to sustain economic momentum as China's population declines. Cai Fang, an academician at the Chinese Academy of Social Sciences, suggested the government establish a specific goal for the "household final consumption rate." This term refers to the share of household spending in the nation's total economic output, or GDP. “In addition to setting a gross domestic product growth per capita target through 2035, we should also establish a target for the household final consumption rate,” Cai said. He explained that increasing this share would help drive future economic growth.