To increase domestic demand by expanding the middle-income group is of critical importance to China's economic development. The huge Chinese market, which is mainly composed of middle-income people, can provide a strong guarantee for sustained growth.

China now has more than 400 million middle-income people, but that is only about 30 percent of its more than 1.4 billion population. Furthermore, the internal structure of the middle-income group is unbalanced, with relatively low-income people accounting for a large proportion and some middle-income people lacking stable employment and facing the possibility of slipping back into low income groups again.

To expand the size of the middle-income group, China must spur people's enthusiasm, initiative and creativity, maintain macroeconomic stability, and achieve higher quality, more efficient, fairer, and more sustainable development.

Without a solid material foundation, employment cannot be guaranteed, income levels cannot be raised and continued expansion of the middle-income group will not be possible.

To expand the size of the middle-income group, the country should comprehensively reform the income distribution system in order to narrow the income gap, and break the barriers of entrenched interests.

It should speed up the improvement of the social security system, and accelerate the equalization of basic public services. It should try to improve the fundamental market economy systems such as the ones on property rights protection, market access, fair competition, and social credit, optimize the business environment and increase people's sense of security about their property.

Expanding the middle-income group will also help release China's reform dividend. With the two promoting each other, a series of strategic goals the country has set itself will be realized.