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Australia says China economic miracle is not over
December 13, 2012, 1:45 pm

China's Wang Yang, Party Secretary of the CPC Guangdong Committee,(left), and Australian Prime Minister Julia Gillard (right). [Getty Images]

China’s Wang Yang, Party Secretary of the CPC Guangdong Committee(left) and Australian Prime Minister Julia Gillard (right). [Getty Images]

China is on track to become the biggest economy in the world during the next 10 years, says a report from the Australian Federal Treasury.

In continuation with its “look-East” policy, the Australian Federal Treasury has said that the Chinese economic “miracle” is far from ending.

The 40th anniversary of the Australia-China diplomatic relationship was the spotlight of a special edition of the treasury’s quarterly economic round-up.

“A number of commentators have raised doubts regarding the sustainability of the Chinese economic growth ‘miracle’ going forward, pointing to the slowdown in Chinese economic growth since the beginning of the year,” says the report.

“The consensus view is that China still has significant potential to grow, particularly through the ongoing process of ‘catch-up’, as China’s overall urbanisation and productivity levels still lag significantly behind those of advanced economies.”

In 2009 China surpassed Japan to become Australia’s largest export market, with total merchandise exports to China valued at $42.4 billion, an increase of 31.2 per cent over the previous year.

China’s reforms have enabled the country to achieve an economic miracle, with an average annual growth of 10.7 per cent from 2003 to 2011, much higher than the world average of 3.9 per cent over the same period.

Projections of China overtaking the United States to become the largest economy in the world in the next decade have also been made by the International Monetary Fund.

The Australian government’s Asian Century white paper, released in October said: “Whatever else this century brings, it will bring Asia’s rise.

“The transformation of the Asian region into the economic powerhouse of the world is not only unstoppable, it is gathering pace.”

The White Paper projects the Chinese economy to grow at an annual average growth rate of seven per cent from 2012 to 2025.

Although this growth rate is slower than previous years the treasury report explains that, “given China’s stage of development and the size of its economy, an annual growth rate of seven per cent is still very impressive”.

The report also suggests that this “robust pace of growth” appears more sustainable than the continuation of double-digit pace seen in previous years.

The BRICS Post