The economic growth of China has come down quite drastically in recent period which was growing quite handsomely over the period of last 13 years. Last month released quarterly economic growth rate stands at the 7.7 percent whereas the country is used to double digit growth over the last decade. This has now worried the Chinese leader and policy maker who now have focused on the ambitious reform plans in order to revitalize the economy.

As the statistics shows, the Chinese economic growth is at weakest in 13 years period; however is still one of the strongest growths if compared to developed economies. In order to revitalize the slowing Chinese economy, Chinese president Xi jinping is expected to come up with new economic agenda for this decade which would probably shape the current global economic landscape as well. The world’s second largest economy traditionally dependent upon the low cost labor and cheap product could be shifting its attention to the consumer based economy like the one in advanced economy.

The major change expected from the Chinese government can be liberalized interest policy and revamping of the local government fiscal system among others. Currently, the Chinese government dictates the interest rate which is more focused on the rapid economic growth of the country. The liberalization of interest rate means the market force of demand and supply for the fund will discover the interest rate rather than state policy which until now have been focused on the high economic growth. Further, the fiscal dependency of states in China are more or less on the sale of volatile land price as Chinese tax structure allow central government get big share of receipts and local government are left with little which isn’t sufficient for spending plan.

Likewise, in the coming decades the Chinese government is planning to bring some 400 million people into the cities which will again require huge amount of money, a 40 trillion Yuan (around US$650 billion) of investment is required in the infrastructure. This means millions of people would be turning from migrant worker into consumer. This revamp of the economic structure would turn this giant economy from exporter of cheap goods in the global market to more sustainable consumption based economic model.

This may be the radical change that is expected to take place in the world’s most populous country over this decade which also holds many risks and surely need to address with the proper policy and reform. The major challenges to address through the upcoming policy would be tackling of corruption, inefficient investment, mounting local government debt, liberalizing the interest rate and the local government without which the sustainable economic model would be difficult to achieve.