Active measure for economic development: Commentary

The following is a translation of the full text of a commentary by People's Daily Commentator on further implementing the Party Central Committee's policy on strengthening macroeconomic regulation and control, which was published on the front page of this leading newspaper on June 14, 2004.

A further implementation of the Party Central Committee's policy on tightening macroeconomic regulation and control is a very important and urgent task for current economic work, from the overall and long-term point of view, it is all the more an active measure for developing the economy.

Strengthening macro-regulation and control is by no means artificially slowing down the pace of economic development, but instead it is acting upon the objective economic law, timely eliminating unstable and unwholesome factors in economic development and promoting a fast and sound development of the national economy. Since the latter half of last year, some outstanding contradictions and problems have occurred in China's economic operation, the most striking one is the too speedy growth in fixed asset investment, the too many newly started projects and excessive construction scale. Some other problems resulting therefrom, such as too rapid growth of monetary credit, the occupation of huge amounts of cultivated land by the unwarranted setting up of development zones, the short supply of energy and important raw and semi-processed materials, and soaring commodity prices. If policy measures are not adopted in time to tighten macro-control, economic operation is bound to be tightened up, the outstanding contradictions in economic life is bound to become sharper, resources and the environment will be unable to bear the heavy load, and it will be hard for the national economy to continue its rapid development.

The Party Central Committee and the State Council have promptly spotted the emerging problems, made accurate judgments and timely and resolutely adopted a series of macro-control measures to deal with the outstanding contradictions and problems existing in China's economic operations. Thanks to the vigorous efforts made by various localities and departments in unifying understanding and putting these measures into practice, initial results have been achieved in macro-economic control. Outstanding problems in the economic life have been alleviated somewhat: the trend of the too rapid growth of fixed asset investment has been brought under check, the excessive investment momentum in some industries has begun to fall; price of food grain has tended to become stable, the swelling prices of important means of production have slowed down; agriculture has been strengthened, food production has experienced a favorable turn; and fruitful results have been achieved in rectifying the indiscriminate occupation of land by development zones. Meanwhile, the national economy has continued to maintain a good development momentum. The economy is growing rapidly, with GDP increasing by 9.8 percent year on year in the first quarter; profits continued to rise, financial revenue rose by a big margin, the incomes of urban and rural residents had a fast increase, and the consumer market was stable and brisk. Foreign trade experienced sustained and rapid growth. The report on China's May economic operations released recently by the National Bureau of Statistics (NBS) shows that the fruitful result of macro-economic control has more clearly manifested itself, the entire economic operation is developing in the anticipated direction of macro-control.

It is of course gratifying to see the desired result in macro-control, but we must be soberly aware that because many policy measures are still in the process of implementation, there exists great inertia in economic operations, problems in current economic life are fairly prominent: Fixed asset investment demand remains too strong, monetary credit is still operating in a high order, there is still an acute shortage in coal, electricity, oil and transportation, the general level of prices remains rather high, so the task of macro-control remains very arduous. Therefore, we must not waver in our determination to strengthen macro-control, not weaken our effort and not slack off in work.

Strengthening macro-control requires that we genuinely institute a scientific development concept and properly protect, guide and display the enthusiasm of various quarters in quickening development. Development is the task of paramount importance for our Party in administering and making the county prosperous, at no time and under no circumstance should we waver in making economic construction the central task. But what we want is sustainable development featuring quality, efficiency and comprehensive coordination, development that can really bring immediate benefit and long-term interest for the masses of people. China's economic development is now in an important juncture, only when we maintain a fairly steady, rapid economic development, avoid detours and avert major economic fluctuations, can we truly seize and properly use strategic opportunities and win precious time for China's modernization drive.

Various regions and departments should enhance their concept of the interest as a whole, and their awareness of the overall situation, they must earnestly make their thinking in keeping with the Party Central Committee's judgment on the current economic situation, with its plan for economic work and with the establishment and implementation of a scientific development concept and a correct view on one's administrative achievements. It should be pointed out that one often cannot clearly see some situations and problems in the macro-economy purely from a certain part of a locality, from an aspect of an industry or from the micro-condition of an enterprise, one can have a correct grasp of these situations and problems only when one makes a comprehensive observation, deep analysis and long-term consideration of them. We must have a comprehensive, accurate and positive understanding of the Party Central Committee's policy on strengthening macroeconomic control, firmly and unshakably implement it, pay close attention to the new situations and new problems arising in economic operations, make overall planning and give all-round consideration, treat these situations and problems by looking into both the root causes and symptoms of these problems and ensure the smooth achievement of the macro-control objective.

By People's Daily Online