Growth model

"Relative to China's own history and other developed and developing countries across the world, China's private consumption to GDP ratio today is low. As such, China needs to, and in fact has, already started to adopt policies to reflate consumption as a key driver of economic growth."

Louis Kuijs, China economist at Royal Bank of Scotland in Hong Kong and who was a senior economist at the World Bank during Lin's period as chief economist, also says China has to change its growth model.

"I used to have these discussion at the World Bank. China cannot continue to increase its investment to GDP ratio. It is just not possible economically.

"I have sympathy with the argument also that it doesn't make sense to hand out credit cards to try and stimulate consumption but China definitely needs a better balanced pattern of growth."

Lin, who argues that sustainable consumption can only come from investment in upskilling the economy so workers have higher wages to spend, has his defenders, however.

Tomas Sedlacek, the leading Czech economist and author of the best-selling book, Economics of Good and Evil, also warns of the dangers of going down the consumption road.

"I actually believe it is fine that GDP is boosted by investment (in infrastructure) and by exports rather than driven by consumption as in China," he says.

Sedlacek, chief macroeconomic strategist for CSOB, a commercial bank in the Czech Republic, says if China went on a spending spree like the West before the financial crisis it could end up in a similar mess and the result would be less consumption than there is now.

"Consumption must not be fueled by credit. Historically, with previous global crises, there was nothing to eat such as after a bad harvest. It was a crisis of insufficient supply. Now in the Western world there is a crisis of demand. There are enough cars and razor blades but we don't have sufficient consumers."

China's consumption has not always been low. In the 1950s and 1960s, it averaged around 60 percent of GDP, hitting a peak of 71 percent in 1962.

Following reform and opening up in the late 1970s, the government embarked on a program of unprecedented investment to modernize the economy, resulting in the current skewed economic structure.

Martyn Davies, chief executive officer of Frontier Advisory, a leading research and strategy-consulting firm, based in Cape Town, is one who has been critical of the pace of reforms in China and an over-reliance on an investment-heavy economic model.

He says the danger for Africa was actually in following the outdated China economic development model with African leaders advocating state capitalism rather than free market reforms.

"We have gone from almost a market fundamentalist position of the post 1989 Washington Consensus to a more interventionist form of state capitalism.

"Words like 'privatization' and 'free market trade' have almost become dirty words and you are never likely to hear them at a South African political forum. The Western financial crisis has been used to justify this."

Kwok at HSBC says in China, the government now faces the same risks trying to alter the economic structure again toward more consumption as did the early reform administrations.

"As with any structural reform policy, the risk is if the pace at and intensity with which reforms are introduced is inappropriate," she says.

"If too slow, structural adjustment fails to occur. If too fast, then new imbalances could be created in other aspects of the economy."

Hans Hendrischke, professor of Chinese business and management at the University of Sydney Business School, says there is a problem with the consumption debate when it ceases to become one between economists and then involves the press and other commentators.

"This is what you have when you have a debate that starts off in strictly economic terms and then becomes translated into those who say we must have more consumption because we are against all these investment people.

"In reality, it is actually quite complex and the two alternatives - consumption and investment - are not actually mutually exclusive."

One significant contention of many economists is whether China's consumption is actually weak at all.

Zhu at CEIBS points out that between 1990 and 2010, China's consumption grew by 8.6 percent a year (adjusted for inflation), nearly three times the global average of 3 percent.

"In the US consumption growth was less than 2 percent during this period and in Europe 2 percent. Nobody actually needs consumption. It is an outcome of economic growth and not a reason for it. A family cannot get rich by consuming."

The Chinese government has so far attempted to boost consumption by focusing on education and welfare provision, particularly a universal pension system, which have been the traditional barriers to consumption, forcing people to save.

It has also increased the minimum wage across the country. Future reforms across the banking system are also likely to make consumer credit more widely available.

The government would also like to see migrant workers settle in new cities with their families as part of the country's urbanization program. They are then likely to spend more, rather than remitting back nearly all their wages.

Kuijs at Royal Bank of Scotland believes the government has put in place many of the right measures that will boost consumption.

"Since 2005 the Chinese government under the previous administration - which is sometimes criticized for the pace of its reforms - has done an impressive job in putting in place many of the measures necessary," he says.

Zhu argues it is important that China gets the balance right and has a consumption level appropriate to its stage of development avoiding the problems faced by other developing countries such as Brazil.