More attention must be directed to the issues of investment efficiency and quality of economic development as China is on the upward track of an economic growth period, said Cheng Siwei, vice chairman of the Standing Committee of the National People's Congress.

Cheng, also a renowned economist, said he found the benefit of investment in the nation was abating even though the overall economy was on the rise.

Cheng made the remarks when attending an international conference on iron and steel which was held in Shanghai on Monday.

In 1999, one percent of investment growth on capital assets contributed to 1.29 percent of GDP (Gross Domestic Product) increase, but the figure fell to 0.19 and 0.17 percent in 2000 and2001, Cheng said.

In the first quarter of 2004, the fixed assets investment rose by 43 percent, resulting in only a 9.8 percent GDP growth.

The statistics indicate that investment in fixed assets is not as efficient as it used to be in terms of stimulating the national economy, Cheng said.

Most of the investment went to infrastructure building, which of course takes time to see the effects, but meanwhile, much fund was poured into some projects that were constructed repeatedly, said the official.

Observers said that the government administration shifts in 2003 at all levels of the country led to another investment surge.In addition, corruption and misjudgment still seriously harmed the investment efficiency.

The Chinese government needed to make efforts to hold investment, and so far some measures started to take effect, even though the country also tried to avoid a hard landing, Cheng said.

China is in a transitional period toward an industrialized nation and it might take approximately 10 years to complete the transition process, he said.

Source: Xinhua