2004-10-19

China economy to grow 9.4%

[article from China Daily online]
<>2004-10-10 China's economy is expected to grow 9.4 per cent this year and slow slightly to 8.9 per cent next year, reported the Chinese Academy of Social Sciences at a symposium on China's economic situation in Beijing yesterday.
[...]
"If there are no major breaking events internationally, or severe natural disasters or other big domestic issues, the country's economy is capable of maintaining a growth rate of more than 8 per cent next year, due to the country's macro-control measures," he said.
[...]
However, some prominent problems in the economy have not been fundamentally rooted out, he said. Energy and transportation bottlenecks, possible rebound in fixed asset investments and the fast decline in money supply and loans are still troubling, he said.

Niu Li, a senior economist at the State Information Centre, said the government should also be alert to a further price rise, as price pressure has already become very large. <>"While food prices remain at a high level, international oil prices are rising rapidly," he said.
[...]
The price rise would have a certain negative impact on ordinary people's lives, Niu said.
[...]
The consumer price index, policy makers' key inflation gauge, rose a year-on-year 4 per cent during the first eight months of this year, earlier figures indicate. <>This means Chinese citizens have already suffered a negative interest rate, according to Qi Jingmei, another economist with the centre.
[...]
A negative interest rate also leads to a decline in bank deposits, she said. "This will make their purchasing power drop."

"Some low-income families have even begun to worry whether their income can meet the basic needs for food and clothing," Qi said.

"Their health could also become at risk, because they will buy the cheapest products and not pay enough attention to the quality of food."
[...]

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