Economic Growth Momentum 'will be Sustained'

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Last updated at: (Beijing Time) Saturday, August 02, 2003

Economic Growth Momentum 'will be Sustained'

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China's strong economic performance in the first half has encouraged government officials and economic researchers to predict strong growth in gross domestic product (GDP) "for a relatively-long period".

With the nation entering another economic growth spurt following that in the early 1990s, the momentum will be sustained, they stressed.

They also agreed that a number of positive factors such as a rapid increase in fixed-asset investment and industrial upgrading will contribute to an accelerated pace of growth.

The optimistic forecast came amid mounting debate among economists about whether China can maintain a stable and high GDP growth in the coming years.

Some economic researchers have even cited an increasing number of alarming signals - characterized by a sharp rise in money supply and bank lending - to warn about an overheating economy.

The economy grew by 8.2 per cent in the first six months of this year despite a huge setback from the outbreak of SARS, according to the National Bureau of Statistics (NBS).

The country recorded 9.9 per cent GDP growth in the first quarter from a year ago, the highest growth rate in six years.

Zheng Jingping, director-general of the Department of Comprehensive Statistics at the NBS, underscored the tough background against which the Chinese economy managed to achieve stable and high growth.

The obstacles included soaring crude oil prices caused by the Iraqi war, a slow global economic recovery and the huge economic fallout of SARS.

"This well suggests that the Chinese economy has greatly developed internal vigour through gradual accumulation of economic strength over the past few years," Zheng said.

"The economy is growing on a new upward spiral and will not be brought down by external impact that is not very severe."

Sharing the view, Zhang Liquan, a senior researcher with the Development Research Centre of the State Council, said the current economic growth spurt is based on a "strong economic foundation".

"In that sense, China's fast economic growth will continue for a relatively-long period rather than being short-lived," he said.

Earlier, Zhang and his colleagues forecast that the economy would be on a fast track between 2003 and 2011.

The researcher listed several economic stimuli that he predicted will consistently spur the economic development:

Rising consumption will lead to an overall industrial upgrading which will promote the development of some major industries;

China's ambitious urbanization bid is set to benefit the development of service industries and generate huge job opportunities;

The private sector, which is playing a bigger role in national economic development, is expected to inject new vitality into the economy; and

China, as a World Trade Organization member, will open its doors wider to overseas capital and technology. (China Daily News)

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