久久亚洲国产成人影院-久久亚洲国产的中文-久久亚洲国产高清-久久亚洲国产精品-亚洲图片偷拍自拍-亚洲图色视频

  Home>News Center>China
       
 

China's economy: Where will it go from here?
By Xu Binglan (Business Weekly)
Updated: 2004-06-07 07:55

History repeats itself. But sometimes, it repeats only part of itself.

That seems to be the case for the Chinese economy since last year.

A few economic indicators have been rocketing since 2003, peaking in the first quarter of this year.

The hottest figures are the growth rates of fixed asset investment and banking loans.

Fixed asset investment grew by almost 50 per cent during the January-March period. Money supply has been stable at 20 per cent since last year.

To some, this is reminiscent of the heady years of 1992 and 1993, when investment grew 38 per cent and 50 per cent, respectively.

They worry that the economy is overheating and the unsustained rate and possible austerity measures from the government will make the economy crash with a hard landing, which refers to an abrupt contraction that could be accompanied with corporate failures, a financial meltdown and rising unemployment.

However, right from the first overheating warning signs last year, there have been voices of disagreement.

And the contention among economists and different government departments is still evident.

"I would not say it is overheating,' said Xu Hongyuan, a senior economist with the State Information Centre, a key think-tank for the National Development and Reform Commission.

"There are just some structural problems, over-investment in some sectors, but nothing more than that."

Overheating is a word that befits a much more sweeping situation, like what happened in the early 1990s, Xu said.

China saw white hot stock, futures and real estate markets and a rage in building in the so-called development areas in 1992 and 1993. The price index soared to double-digit figures.

But now, the problem is mainly surging investment in certain areas and a shortage of power, petroleum and some other resources, he said.

Equity and commodity markets are performing steadily. The price index, though creeping up, is still well below the 5 per cent level that is regarded as the threshold for real inflation.

The price index is the key indicator for inflation and the temperature of the economy.

The consumer price index hovered around 3 per cent during the first quarter of this year. But during 1992-94, the major price index was in the territory of 15-25 per cent.

"So the economy is not overheating now," Xu said. "And discussions over a soft or hard landing are meaningless. The economy does not need to land at all."

But Fan Gang, a renowned economist and director of the National Economic Institute, said the soaring investment growth alone indicates that there is overheating as the high investment figures reflect a general imbalance between supply and demand.

Within the government, the most important warning sign comes from the central People's Bank of China, which in its first-quarter monetary policy report directly voiced its concern for full-fledged overheating.

However, the bank's vice-governor Wu Xiaoling, speaking at a regional forum at the end of April, qualified her comments, saying that the economy is overheated "if measured by the sustainability against the availability of resources," because none of the nation's energy, water and land resources can support the current growth.

Indeed, the stress on resources is one of the main characteristics of this round of surging investment.

Officials from almost all of the other economic policy making bodies stopped short of accusing the economy of being overheated, although they said there were many unnecessary projects.

Hence, they said, a selective approach - instead of sweeping round of cooling off, is needed.

The aim of choosing this approach is to maintain the economy's growth momentum and avoid a drop off in growth.

The central government has been sweeping through projects that have broken laws and regulations in terms of land use and environmental protection. It also pointed out that the steel, aluminium and cement sectors are over-invested.

Realizing that various local governments were pushing for some redundant projects, the central government, using administrative measures, told local governments to refrain from continuing to do so.

Although the central bank was the first and most explicit in its warning, it only adopted mild measures, instead of being aggressive and raising interest rates.

It increased reserve requirements to the commercial banks and issued them bills. It is intended to reduce the banks' lending funds, but will not increase investment costs for all enterprises as an interest rate increase does.

"My concern is not overheating. I am afraid of unnecessarily tough braking steps," said Zhang Liqun, a senior research fellow with the State Council Development Research Centre.

With the net export shrinking and consumption stable, a significant slowdown of investment will cut the economic growth rate under the desirable level, Zhang said.

It is widely believed that the Chinese economy needs to grow by at least 7 per cent annually to create jobs for the new workforce and those let go through the restructuring of State-owned enterprises.

"After all, we are still facing challenges in employment," Zhang said, "So I support the government's approach in dealing with the current situation. It will work."

In fact, it has already started to work. Investment growth, credit growth and steel price have all been curtailed.

Zhang said he is also optimistic because market forces have a much bigger role in determining supply and demand than they did a decade ago.

"So many problems will be rectified by market forces now," he said.

Stephen Roach, Morgan Stanley's chief economist, shares Zhang's view, although he says the economy is overheating.

Roach noted that the investment bubble of a decade ago was largely an end result of State-sponsored excess, while the current investment dynamic reflects the mixed impetus of public and private spending.

"To the extent that private sector investment is driven by market-based returns, the risk of a misallocation of capital would be lower," he said.

"Inasmuch as the seriously unbalanced Chinese economy of a decade ago managed to sidestep a hard landing, I am confident that the intrinsically stronger Chinese economy of today will be equally successful. Consequently, I remain in the China soft landing camp."

While an appropriate investment slow-down would be good for the health of the Chinese economy, there is the worry that it would negatively affect regional and even global economies.

"I would not buy this," the State Information Centre's Xu said.

(Editor's note: Surging investment growth and rising demand for energy and raw materials have prompted concerns that the Chinese economy is suffering from overheating. The government has taken measures to address the imbalance. But debate is still raging over whether the economy is really simmering, what should be done and the implications of measures to cool it down.

From today, China Daily will publish a series of analytical reports and industrial case studies on the general situation, financial policies and the implications for regional and global economies and foreign companies that have interests in China.)

 
  Today's Top News     Top China News
 

China's economy: Where will it go from here?

 

   
 

Tougher wildlife protection law under way

 

   
 

Weakened Bush seeks luster at G8 summit

 

   
 

Reagan to be honored with state funeral

 

   
 

Survey: Men like radio; women dig television

 

   
 

China expects first unmanned moon mission

 

   
  Tougher wildlife protection law under way
   
  Stress on politics 'takes toll on economy'
   
  China's economy: Where will it go from here?
   
  Volunteers to clear up Qomolongma waste
   
  'Green' thinkers save environment
   
  Survey: Men like radio; women dig television
   
 
  Go to Another Section  
 
 
  Story Tools  
   
  Related Stories  
   
Efforts 'paying off' on market status
   
Macro economic measures begin to pay off
   
No instant cure for overheated economy
   
Accelerated growth is cause for concern
   
Landing? What landing? It's cruising along
   
First quarter economy grows 9.8%
   
China to achieve a soft landing
  News Talk  
  When will china have direct elections?  
Advertisement
         
主站蜘蛛池模板: 国产高清国产专区国产精品 | a级片观看 | 日本不卡一区二区三区在线观看 | 白嫩美女一级毛片免费看 | 午夜成年 | 精品国产一二三区在线影院 | 在线高清免费爱做网 | 国产精品毛片天天看片 | 国产精选一区 | 国产成人久久精品 | 久久网在线 | 91香焦国产线观看看免费 | 国产成人区 | 99精品免费视频 | 免费a网址 | 国产精品久久久精品三级 | 美女一级ba大片免色野外 | 日本免费人成黄页在线观看视频 | 国产一级片观看 | 欧美成人极品怡红院tv | 久久成人在线 | 一级做性色a爱片久久片 | 成人午夜影视 | 99精品免费久久久久久久久日本 | 久久99精品热在线观看15 | 一本一道久久 | 欧美日韩性视频一区二区三区 | 福利云| 欧美精品在线视频观看 | 色播亚洲精品网站 亚洲第一 | 国产男女视频在线观看 | 国产日韩欧美精品一区 | 国产成人一区二区三区免费观看 | 欧美激情综合亚洲一二区 | 国产三级日本三级美三级 | 国产精品在线观看 | 精品一区二区三区视频在线观看 | 欧日韩视频 | 国产午夜免费视频片夜色 | 日韩欧美久久一区二区 | 综合久久久久久中文字幕 |