Economy Growths Healthily in May


Updated Wed, 21 Jul 2004 00:00:00 GMT

In May of this year, China's industrial growth reached 17 percent and the total import and export volume increased 34 percent, making profits of over two billion US dollars. Some industries which had an excessive increase in the first quarter slowed down.

Meanwhile, China's fixed assets investment was up 18 percent, 16 percent lower than the figure for the previous month.
At the same time, the Consumer Price Index or CPI was four percent lower than in April. So the actual CPI increase was only half a percent in May. In addition, the hike in the money supply began to slow down and level off. All these, as director of the National Statistics Bureau, Qiu Xiaohua says, indicate sound economic growth.

"All these economic phenomena can be summarized into two sentences: industries or economic sectors that need to rise go up and indexes that are required to drop decrease. All developed towards a sound direction as our macro-control expected."

In the first two months of 2004, industrial growth averaged 18 percent while in the agricultural sector, grain production saw a huge increase. In the first quarter, farmers' cash income shot up nine percent, nearly two percent more than the same period last year. In the second quarter, a double digit increase is expected. Qiu Xiaohua explains that all these show a strong signal of continuous economic growth.

"I am confident that we can realize the goal of an economic 'soft-landing' in this year, which is to maintain a relatively fast growth rate while keeping inflation down."

But the director also points out some problems that China should be cautious at present such as energy shortage and excessive investment in some areas. The director says though the investment in steel and cement has slowed down, the growth rate is still about sixty percent. Therefore, macro-controls still need to be fine-tuned.