Less income disparity 'helps economy'

NEW YORK: The World Bank's chief economist is pinning his hopes of China's successful development in the coming years on a decrease in the country's huge income disparity.

The income disparity, at 0.48 measured by the Gini Ratio, has become larger and larger, causing other imbalances such as savings and investment imbalances and an external imbalance, Justin Lin Yifu, chief economist and senior vice president of the World Bank, told a China 2010 economic forecast meeting held on Thursday at the New York Stock Exchange.

"It's very important for China to complete the transition to a market economy to remove all the distortions in the financial sectors and in natural resources sectors," Lin told a gathering of hundreds of businessmen and academics, sponsored by the China Center for Economic Research (CCER) of Peking University and the National Committee on US-China Relations.