China Achieves 8.2% GDP Growth in 1st Half Year Despite SARS

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Last updated at: (Beijing Time) Friday, July 18, 2003

China Achieves 8.2% GDP Growth in 1st Half Year Despite SARS

In the first half of this year, China achieved a gross domestic product (GDP) of 5.0053 trillion yuan (about 605 billion US dollars), up 8.2 percent from the same period last year.

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In the first half of this year, China achieved a gross domestic product (GDP) of 5.0053 trillion yuan (about 605 billion US dollars), up 8.2 percent from the same period last year.

Spokesman for the National Bureau of Statistics (NBS) Yao Jingyuan told a press conference Thursday that although the growth was slower than the first quarter, it was still 0.4 percentage points faster than that for the same period last year and was one of the fastest growth periods since 1995.

According to Yao, the negative impact on the country's national economy from SARS started to show effects in the second quarter of this year. Passenger transportation, catering, social services and tourism were hardest hit by the disease.

The NBS statistics showed that the growth rate of China's GDP dropped to 6.7 percent in the second quarter, 3.2 percentage points lower than the first quarter.

The growth rate of the tertiary industry climbed only 0.8 percent in the second quarter of the year, down 6.1 percentage points from the same period last year, Yao said.

Passenger transportation volumes dropped 23.9 percent during the period, and air passenger transportation volume shrank by almost half.

A survey conducted by the NBS showed that the income volume of the social service sector was down 14.8 percent in the first half of the year when compared to last year, and retail sales of consumption items increased 6.7 percent, 2.5 percentage points lower than the first quarter.

The growth rate of agricultural added value dropped from 3.5 percent in the first quarter to 2.3 percent in the second, Yao said, attributing the drop to negative SARS influence.

SARS also cut the per capita cash income of Chinese farmers by 35 yuan (about 4.5 US dollars) in the second quarter of the year.

China's economy will follow a "U" curve this year, slowing down in the second quarter, picking up speed in the third quarter and accelerating in the fourth quarter, Yao said, predicting that investment, consumption and export, the three major contributors, would maintain last year's performance representing their contributions to aggregate economic growth.

China's robust industrial output growth still remained strong, contributing 5.8 percentage points to the growth rate of the country's GDP in the first half year.

The value added output from Chinese large industrial enterprises in the first half year totaled 1836.3 billion yuan (about 229.5 billion US dollars), 16.2 percent more than the same period last year.

The growth rate of the value added output from Chinese large industrial enterprises also recorded an increase of 4.5 percentage points, the fastest growth for the period since 1994.

The contract value of foreign direct investment (FDI) in the first half year reached 51 billion US dollars, 40.3 percent higher than the same period of last year, and the actual FDI was valued at 30.3 billion US dollars, 34.3 percent more than the first half of last year.

Investment and exports will maintain strong growth momentum, Yao said, noting the impact of SARS on exports may become visible in the second half of this year, but will not last through the end of this year.

In addition, sluggish consumer demand will improve to push forward economic growth as a whole, Yao predicted.

Economic Growth Continues Positive

China's economic growth is in good condition as fiscal revenue, corporate profit and individual income all increased greatly in the first half year despite the outbreak of severe acute respiratory syndrome.

Statistics show that China's fiscal revenue in the first half of 2003 was 1,095.5 billion yuan (132 billion US dollars), up 27.4percent over the same time last year. The revenue was 128.9 billion yuan (15.5 billion US dollars) more than the fiscal expenditure.

The profit of industrial enterprises was 291.8 billion yuan (35billion US dollars) in the first five months, growing 62.8 percent year on year, of which the profit of state-owned enterprises was 153.3 billion yuan (18.5 billion US dollars), up 89.9 percent, he said.

In the first half of the year, 36 of the 39 major industrial sectors kept profit growth. Among these, crude and gas mining, transport equipment manufacturing, ferrous metal smelting and rolling, chemical industry, and electricity industry increased profit by 72.18 billion yuan (8.7 billion US dollars), accounting for 64.1 percent of the total industrial profit growth.

Yao said that the powerful growth was due to the soaring investment in fixed assets, increasing consumption, industrial restructuring and international market exploration.

Chinese residents' income also increased in the first half of the year. Urban and rural residents' per capita income was 4,301 yuan and 1,158 yuan, increasing 8.4 percent and 2.5 percent year on year discounting inflation.

By the end of June, bank deposits excluding foreign currencies reached 9,770 billion yuan (1,180 billion US dollars), an increase of 1,068.9 billion yuan (128.8 billion US dollars) over the beginning of the year.

In the first six months, consumer price index grew 0.6 percent compared with the same period last year.

Yao said despite a few over-developed industries and regions, economic growth was stable. Economic and social development will continue this stable trend in the next half of the year, and the goal of 7 percent economic growth for this year will be achieved.

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