China is heading toward more consumerism

This was very interesting economic analysis about the chinese measures to mitigate the impact of the financial crisis.
Chinese economy is depending mainly on the exporting. The last financial global crisis has shaken heavily the Chinese economy because of the weakening of the importers' economy. The heavy consequences of any financial crisis would affect always the country which has strong exporting dependency policy and relatively weaker domestic trade.
The Chinese have understood the lessons and they decided to strengthen the domestic trade.
They have taken some measures to re-balance their economy between the exporting and the domestic trade. This will reduce the risk exposure due to dependency on the export.
The rural areas of China are well known about their low spendings. The Chinese government started to encourage them to increase their spendings but subsidize the home appliances. It is a targeting subsidizing for only the rural citizens. This policy has several benefits. It will increase the development of the rural areas and improve the living standards of the rural people and in the same time it will activate the domestic trade.
The subsidization is up to 13% and the customer has to prove that he resides in rural areas.
This will activate the domestic trade and will reduce the full dependency on the exports.
This should be the policy of any subsidizing. It should be selective and intelligent.
Having said that, it will not be the root solution for activating the domestic trade.
This will be only temporarily solution. On the later stage they should tackle the root causes of the over savings by establishing comprehensive social security system.
China as the majority of the developing countries haven't reliable and comprehensive social security system. That's why the people has to plan secure themselves by precautionary savings.
There is no unemployment insurance and the medical insurance is weak in addition to the lack of education support and post retirement uncertainties.
All these are pushing people to take precautionary measures by stocking their savings for these reasons.