Gaining without any pain seems 'illusionary'
No pain, no gain — that’s what a former Chinese central bank official emphasized yesterday at the Lujiazui Forum as she cautioned China’s policy-makers that it’s time to halt uncalled-for support for certain sectors and let the market play its role.
With China’s real economy remaining sluggish and domestic consumers shifting their demand to overseas, the Chinese government has been accelerating its efforts since last year to combat overcapacity in sectors such as steel and encouraging new industries such as innovation to be the catalyst to revive the economy.
Such change hurts but the pain is a necessary process as Wu Xiaoling, former deputy governor of the People’s Bank of China and now dean of the PBC School of Finance at Tsinghua University, said in a panel discussion on supply-side reforms, financial innovation and macro prudential regulations at the forum.
“Monetary stimulus or credit easing is not a long-term plan,” Wu said. “It’s illusionary for someone to imagine a bright future without growing pains.”