China Watch Blog

China Watch Blog has learnt that the transaction size of China’s online shopping market will surpass Japan in 2012, and exceed the United States by 2013, becoming the world’s largest online trading market, reported Economic Information Daily on May 17.

The report cited the China Business Development Report Forecast (2011-2012) released by the National Academy of Economic Strategy of Chinese Academy of Social Sciences (CASS) on Thursday.

The China Daily report quoted the report as saying that even if China becomes the world’s largest online trading market in the next year, the thriving online shopping market is not enough to cover up problems in the general Chinese circulation industry.

According to Jing Linbo, vice-president of the National Academy of Economic Strategy of CASS, the fundamental reason lies in unclear positioning of China’s circulation industry.

He stated that other problems include market segmentation, enterprises scattered with low concentration, a less competitive market, a lack of theoretical research to guide the practice, and the need for improvement of personnel training.

China’s economic growth may weaken this quarter to the slowest in three years mainly due to the curbs on the property sector and weak external demand, the central government’s think-tank said in a report.

The China Information Center forecast the country’s gross domestic product will grow 7.5 percent in the second quarter of this year from the same period of last year, the slowest since the first quarter in 2009.

The forecast is in line with Premier Wen Jiabao’s remarks in March, and was lower than the 8.1 percent growth in the year’s first three months.

The report said the two factors contributing to the slowdown are “the pains” China must face during the transformation and upgrade of its economic structure.

The report comes as data showed that home prices in the country, excluding those for government-funded affordable housing, fell last month in 46 of the 70 cities tracked by the National Bureau of Statistics, a record high since the figures were first released.

The think-tank also expected inflation to cool to 3.3 percent in the second quarter due to weaker domestic demand. The Consumer Price Index rose 3.4 percent in April on an annual basis.

“China should step up fine tuning of economic policies,” the report said. “It should implement tax cuts, increase support for technological transformation, and reduce fundraising cost for companies to sustain stable economic growth.”