The People's Daily: Consumption is Production

In the face of challenges posed by the financial crisis, China needs to maintain a proper balance between production and consumption, and between investment and consumption.

The People's Daily carries an article saying now that the concept of "expanding production" has been well accepted; people will have to establish the concept that "consumption is production".

For years, China's economy was fuelled by investment, especially huge investments in the secondary sector that consumed large amounts of resources and energy. But this will not make development sustainable.

The article says that this poses a problem as total supply may greatly exceed total demand. That is to say, the growth mode that separates investment from consumption is problematic.

According to the article, production and investment should not be separated from consumption. Consumption is production, that is, the process to consume will boost the need to produce. Consumption is a process by which a product becomes a real one, and consumption is also the motive and goal of production and investment.