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Unstable factors in economy under control
(Xinhua)
Updated: 2005-08-17 10:06
Thanks to macro-control policies by the government, China's economy has
entered another round of steady growth, with unstable factors such as overheated
investment, inflation threats and demand deficiency successfully curbed,
economists said.
Zhang Liqun, an expert with the macro economy department of the Development
and Research Center under the State Council, said that three factors, including
the expanded consumption in housing and transportation, the increase of
labor-intensive products exports, and the growth of a global new economy and new
technology, are driving China's economic development.
Zhang held that these factors would first drive the development of downstream
sectors like housing, automobiles, light textile, home appliances, electronic
communication products, and digital products.
In the meantime, basic sectors like heavy chemical materials, raw materials,
equipment, energy and transportation will be boosted indirectly as well, Zhang
acknowledged.
From the perspective of demand, the driving forces for another round of
economic growth are stable, he said.
Trade surplus rocketing is the most striking hallmarks in China's economic
performance in the first half year, said Prof. Song Guoqing of the Beijing
University.
The net exports, growing at an unexpected rate, are forcefully pushing
forward the country's economy.
Figures from Chinese customs show that in the first half year, China's
exports jumped 32.7 percent, while imports only grew 14 percent, with trade
surplus totaling 39.6 billion US dollars. During the same period last year, the
country's trade surplus was 6.8 billion US dollars.
Song expressed anxiety about China's heavy reliance on exports. It is very
hard to keep the rapid growth of exports for long, so it is of great importance
for the economy to reduce dependence on foreign trade and expand domestic
demand, he said.
Bolstered by the growth of employment and income, China's domestic
consumption is expected to expand stably, said Zhang.
In the first half of this year, the total retail sales of consumer goods
actually grew 12.0 percent, 1.8 percentage points higher than the same period of
2004, according to the National Bureau of Statistics.
"China's high rate of bank savings, investment, robust market demand and
abundant labor forces guarantee the rapid growth of the Chinese economy," said
Zheng Jingping, spokesman of the National Bureau of Statistics.
The hyperactive growth of fixed asset investment has been effectively
controlled. In the first half of this year, China's urban fixed asset investment
grew 27.1 percent, down 3.9 percentage points from the same period last year.
So as to make China's economy grow stably in a longer period, the government
should stabilize its macro-control policy and make full use of market tools in
adjusting economic structure, Zhang suggested.
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