Beijing's efforts to cool down its economy have started to pay off, according to the data made public by Yu Xiuqin, spokeswoman for the municipal bureau of statistics.

Economists had been concerned that booming real estate, steel, cement, aluminum and motor vehicle sectors had produced a structurally overheated economy in China. The central government therefore decided to restrict credit extension to these sectors.

Although investment continues to rise, the data show that the rate of growth has been successfully reduced.

In the first six months of 2004, Beijing reported 87.2 billion yuan (10.51 billion US dollars) in fixed-assets investment, up 22.1 percent over the first half of 2003. The growth rate, however, was 14.4 percentage points lower than the figure in the first quarter.

Total capital investment included 49.02 billion yuan (5.9 billion US dollars) in property development, up 24.2 percent over the first half of 2003, yet the growth rate was 16.4 percentage points lower than that in the first quarter.

During the six months, Beijing suspended 556 real estate projects, involving a combined investment of 166.71 billion yuan (20.1 billion US dollars).

By the end of June, domestic financial institutions recorded 1,185.31 billion yuan (142.8 billion US dollars) in RMB-denominated loans outstanding, 70.99 billion yuan (8.55 billion US dollars) more than the level at the beginning of the year. Yet the increment was 38.41 billion yuan (4.63 billion US dollars) fewer than the figure in the first half of last year, Yu said.

Source: Xinhua