Business News

Private Sector — Not State — Key to China Growth: Pros

Michael Kearns|Head of News and Programming, CNBC Asia-Pacific

China needs to go on a diet. Or at least, experts say, it needs to find ways - and soon - to manage its voracious appetite for resources without compromising growth. And the answer, some say, is not likely to come from the government.

Shanghai skyline
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"I don't want the government to intervene, provide subsidies, etc..," said Lin Boqiang, Director of China Center for Energy Economics Research, at the World Economic Forum Annual Meeting of New Champions in Tianjin. "The private sector will be the driving force for innovation and resource management."

Boqiang points out that China has made huge - and wasteful - investments in solar and wind power, but there has been no payoff, because the markets have not materialized on the scale the government had imagined.

Wang Wenbiao, Chairman of Elion Resources Group, is among those finding opportunities in the resource and sustainability industry. His company is involved in reforestation projects, and he claims to have created 100,000 jobs in the process.

"(The question is) how do we develop the economy and also ? This is a win-win situation," he says.

China already consumes more of some resources, such as coal and base metals, than any other country in the world. It's also the second biggest consumer of oil, while it continues to scan the planet to ensure it can maintain adequate supplies of energy resources. Recent moves include CNOOC's attempt to acquire Canada's Nexen for $15 billion and PetroChina announcing that it is in a buying mood for oil supplies around the world.

But many are not convinced the worldwide hunt for resources will fully satisfy China's needs.

"We just don't have enough resources," said Lin, who took part in the World Economic Forum panel. He and Wang would prefer China look at home for sustainable solutions to fuel its growth, agreeing with the principle of the state retreating so the market can advance.