GDP growth inevitable – what about happiness?

(Ecns.cn) – In the Chinese mainland, 23 provinces each reported gross domestic product (GDP) figures in excess of 1 trillion yuan (US$158.7 billion) for 2011, with six new members entering the "trillionaire club," according to annual economic reports.

The GDP trillionaire club is the result of a decades-long pursuit of economic development by local governments, yet membership in the club only tells part of the story about the economic quality of a region.

Increasingly, Chinese people are realizing that GDP growth does not necessarily equal higher quality of life, and that the numbers achieved by the trillionaire club are not the ideal way to measure true prosperity.

With China's GDP growth predicted to see a moderate slowdown this year, happiness and well-being are gradually becoming the ultimate gauge for the success of economic development, noted China Economic Weekly.

Rising stars

In 2011, China's GDP grew at a robust 9.2 percent to 47.16 trillion yuan (US$7.48 trillion), said the National Bureau of Statistics (NBS) last month. All 31 provinces, municipalities and autonomous regions released separate GDP growth data one after another, and all with impressive results.

Among them, the top three were Guangdong, Jiangsu and Shandong. The GDP of south China's Guangdong Province grew 10 percent to 5.3 trillion yuan (US$841.1 billion) last year; east China's Jiangsu Province grew 9.2 percent to 4.8 trillion yuan (US$761.8 billion); while neighboring Shandong Province came in at 4.5 trillion yuan (US$714.1 billion).

But the shining stars were the six new "trillionaires" – Tianjin, Shanxi, Guangxi, Jiangxi, Jilin and Chongqing, which all reported GDP figures of over 1 trillion yuan (US$158.7 billion) for the first time ever.

Scholars point out that the figures could also be considered a leading indicator of increased investment in the six provinces and municipalities, since investment made up roughly half of their GDP growth.

Tianjin's GDP was 1.1 trillion yuan (US$174.6 billion), with the "three pillar" structure of investment, consumption and exports accounting for 31.1 percent, 18.7 percent and 25.9 percent respectively.

This was also true of the other five rising stars, with the investment-to-GDP ratio all standing above 25 percent.

Inevitable result

The large scale of investment in the six provinces and municipalities has caused many to wonder exactly where the money came from.

Yang Ruilong, professor and dean of the School of Economics at Renmin University of China, analyzed that part of the money came from the accumulation of funds locally, while cheap labor also attracted substantial foreign capital.

With the push of increased investment, GDP in the six provinces and municipalities grew more than 12 percent each in 2011, with Tianjin and Chongqing growing at 16.4 percent, according to China Economic Weekly.

This is a reflection of regularity, as GDP has accumulated in these areas for decades, added Yang. In recent years, GDP growth rates in western regions have appeared higher than those in the central and eastern regions of China, and government policies were the main cause of it.

Since 2000, the government has introduced various strategies such as "Developing the West," "Revitalizing the Old Industrial Bases in the Northeast" and the "Rising of Central China" in order to balance the country's overall economic development.

To some degree, the expansion of the trillionaire club was an inevitable result, and more provinces in the western regions are also expected to join it, said China Economic Weekly.

Scientific happiness

Though China is gradually closing the gap with more developed countries, many problems still exist here, such as imbalanced wealth distribution, housing difficulties, inadequate medical care, and educational injustice.

The principle of "scientific development" must be upheld in China, and improving livelihoods is both the primary consideration and ultimate goal of the country's economic development, claimed Cheng Enfu, a Marxist scholar with the Chinese Academy of Social Sciences.

To judge the economic development and economic strength of a country, GDP is only one of the indicators, while the income levels of its citizens, their quality of life and the degree of happiness are more important, added Cheng.

According to a "happiness index" released by China Economic Weekly, Shanghai, Beijing and Guangdong were among the top three in 2011, where for various reasons residents were arguably more content with their lives than those in other regions.

During the "two sessions" held in Guangdong Province, Wang Yang, Party chief of Guangdong, avoided mentioning a single word about GDP, but instead discussed methods of economic restructuring, which was seen as a possible shift in focus to the quality of economic development.

Income level is undoubtedly an important criterion for judging a person's quality of life, but the government must also improve the public sectors, provide better medical services and education, and enable different social groups to share in the overall economic growth.