Former China central bank official warns against miscategorising ‘virtual economy’
- China must emphasise modern services in its push for new productive forces, Sheng Songcheng says
- Without a hi-tech, high-quality service sector – particularly producer services – there would be no advanced manufacturing, he says
With Beijing keen on developing China’s advanced manufacturing sector while shifting away from Washington’s service-centric growth model, a former official has warned against miscategorising what the “virtual economy” really entails.
And echoing a chorus of calls from Chinese leadership and prominent advisers, he also wants to see more drastic measures taken to enhance R&D and high-end producer services.
The comments by Sheng Songcheng, former chief of the central bank’s statistics department, came as the world’s second-largest economy is looking to learn from countries such as Germany that have embraced advancements in manufacturing.
“My view is, we cannot simply categorise the service sector as the ‘virtual economy’,” Sheng said at a forum in Shanghai earlier this week while comparing China’s service sector with that of the United States.
China’s service sector, which is now the country’s largest source of jobs, accounted for 54.6 per cent of the national gross domestic product last year, lower than 81.2 per cent in the US, he said.
