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China Daily Website

Info sector: new engine of economic growth

Updated: 2013-08-20 16:35
( Xinhua)

BEIJING -- China aims to boost the consumption of information products and services, making the sector a new engine for boosting domestic demand and a new driver of economic growth, according to a guideline released by the State Council, or China's cabinet.

As China's personal consumption is upgrading and the country is undergoing the processes of industrialization, informationization, urbanization and agricultural modernization, information consumption has a sound foundation and tremendous potential.

By the end of 2015, the consumption of information products and services is expected to grow at an annual pace of at least 20 percent to reach 3.2 trillion yuan , according to the guideline.

The value of industries that are supported by information consumption is expected to be boosted by 1.2 trillion yuan by the end of 2015, the guideline said.

As China is reducing the economy's reliance on investment-led growth and exports and gearing it more towards a consumer-led expansion, promoting the consumption of information can invigorate domestic demand and act as a new growth point for the economy, as well as upgrade the service industry and promote economic restructuring.

According to the data published by the Ministry of Industry and Information Technology (MIIT), China's e-commerce sector raked in 4.98 trillion yuan in revenue in the first half of this year, up 45.3 percent year on year. And consumption of information products and services jumped 20.7 percent year on year to 2.07 trillion yuan.

As growth in traditional industries slows, the nation is seeking new growth engines in emerging industrial sectors.

Zhu Hongren, the Ministry of Industry and Information Technology's chief engineer and spokesman, said the ministry hopes to make the IT sector the nation's third-largest, after real estate and vehicles.

Xiong Wei, chief research officer of an investment consulting company in Beijing, regarded information consumption as a new direction of China's economic transformation and update, calling for new technologies and services in the sector.

The State Council elevated national broadband development as as a national strategy, which aims to achieve WiFi coverage in key public urban areas by 2013 and fixed broadband coverage for half of Chinese households by 2015.

The government will release 4G mobile communications licenses later this year and promote the convergence of the telecommunication, Internet and broadcasting networks into one complete system.

China, which has the largest number of mobile phones in the world at 1.2 billion, is already building 4G trial networks in major cities.

However, China needs to take never-stop forward steps in the campaign.

"Generally speaking, China's broadband development is at the middle and lower levels across the world. The situation does not match the country's position as the world's second largest economy," said Fu Liang, a Beijing-based independent telecom analyst.

Compared with neighboring countries such as Japan and South Korea, which emphasized broadband development and invested heavily in related projects decades ago, China has been left far behind, he said.

To better coordinate with public sectors in implementing the guideline, private capital will be encouraged to invest in telecom infrastructure construction, according to government officials.

Besides, small information business-based companies will be entitled to enjoy preferential financial support. And the government will continue to simplify the administrative approval procedures and cut taxes for those businesses, they added.

 
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