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(China Daily)
Updated: 2009-09-17 08:04

If pent-up demand for new cars that has beat all forecast to make China the world's largest car market so far this year is still not enough to prove the potential of Chinese consumers, look at the number of domestic tourists for the upcoming Golden Week.

It is estimated that some 200 million Chinese people will hit the roads during the eight-day holiday starting Oct 1, bringing the tourism sector a revenue of more than 100 billion yuan ($14.6 billion).

That is not only a boon to China's tourism sector, which will see a 25 percent increase in its income for the National Day holiday over the previous year.

It is also evidence of the tremendous potential of Chinese consumers that is yet to be fully tapped.

The rise of Chinese as well as other Asian consumers is widely regarded as a necessary part of the global solution to the increasing imbalance in the world economy. But the difficulties of boosting domestic consumption have, to a certain extent, dissuaded Chinese policymakers from going all out to pursue consumer-centered economic growth.

Shrinking external demand has rendered export, which is a long-term growth engine, into a drag on the national economy. Therefore, it is understandable that Chinese officials preferred stronger investment growth to overcome in a timely manner the slack caused by declining exports. The country's fixed asset investment soared by one third in the first six months, contributing more than 80 percent to the country's 7.1-percent headline real GDP growth for the first half year.

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Yet, such investment-led growth cannot sustain the country's recovery for long. China has to and should be able to generate a consumer-centric recovery.

The unexpected surge in domestic auto sales has surprised many who are skeptical about the purchasing power of Chinese consumers. It is just too hard to understand why Chinese consumers would show such unprecedented enthusiasm for new cars in these days.

Besides, increasing environmental concerns and deteriorating traffic also justifiably raised doubts about the sustainability of an auto-led consumption boom in this country.

However, the coming tourism boom points to another consumer market that is of almost limitless potential, and much more sustainable as people's income level rises.

Some policymakers are reluctant to divert more public spending from investment to boost consumption for fear that the consumers might not open their wallets as expected.

But the army of 200 million domestic tourists should make a compelling argument against any procrastination to tilt the country's economic and fiscal policies in favor of consumers.

With the introduction of more consumer-friendly policy incentives, China as well as the world economy can surely benefit from more and more growth miracles in the domestic consumer market.