SARS Outbreak Does no Harm to Mainstay of China's Economy

Home>>Business

Last updated at: (Beijing Time) Sunday, June 01, 2003

SARS Outbreak Does no Harm to Mainstay of China's Economy

DISCUSSION

CHINESE

SEND TO FRIEND

In the past two weeks, taxi drivers in Beijing have rediscovered traffic jams at the rush hour, while the "closed" boards hanging at the doors of some bars and restaurants have been replaced with big smiles on the faces of bartenders and waitresses.

The capital is gradually waking up from an uneasy snooze, as severe acute respiratory syndrome (SARS) wanes.

"This energetic city will not be changed because of SARS," saidZhang Jiong, a manager of a local advertising company.

Despite the SARS outbreak, all the 873 enterprises and 66 construction work sites in Beijing's economic and technology development zone, a major hub for overseas and high-tech enterprises, did not stop their operation.

"Our project has not been much affected by SARS and goes ahead as scheduled," said a manager, surnamed Wu, who is in charge of a road construction project in Xizhimen, a transportation center in the capital.

Goldman Sachs, a United States-based investment research organization, said in its report that the SARS crisis had influenced China's economy, mainly in public consumption and tourism, which accounted for three percent and five percent respectively of the country's gross domestic product (GDP).

While industrial development was the main driving force of China's economy in the first quarter of this year, industry contributed 55 percent of China's economic growth, according to the report.

According to The Far Eastern Economic Review, the SARS outbreakwas a crisis which had influenced the economy but was not an economic crisis. It was not able to change the root causes of China's economic growth.

In April, a critical period for China's battle against SARS, the country's economic growth reached 8.9 percent.

Meanwhile, the epidemic had not stopped foreign investment flowing into China. Global retail giant Wal-Mart will open its Beijing-based chain supermarket in June as scheduled and has finished commodity purchases, staff training, building construction, interior decoration and other early stage work.

By April, Beijing had approved 143 new foreign invested enterprises, up 53.8 percent over the same period last year. Foreign direct investment amounted to 223 million US dollars, a 50.7 percent increase year on year.

The Far Eastern Economic Review said that ample raw materials and low-cost labor, which attracted streams of foreign companies to invest in China, had more impact than SARS.

Reuters said a survey among mutual fund managers showed China was still the favorite Asian market for investors despite its SARSoutbreak.

"SARS has just changed our timetable for travel and shopping andit will not stop consumption," said Chen Yanfei, an employee of a famous computer company of Qinghua University.

"And the girls in my company are well primed for some shopping after this epidemic," she said.

China's retail sales volume totaled 340.69 billion yuan (41.2 billion US dollars) in April, a 7.7 percent growth over the same period last year, according to figures from the National Bureau ofStatistics (NBS).

Meanwhile, China's foreign trade turnover hit 70 billion US dollars, up 33.8 percent, the NBS figures showed.

A survey by JP Morgan Chase's Chinese research department showed that after mid-May, retail sales in China's large cities had been in gradual recovery.

After the SARS outbreak, the World Bank and the Asian Development Bank both reduced earlier predictions on China's economic growth, but the two banks still said the number would remain above seven percent, the fastest in the world.

The World Health Organization (WHO) lifted its travel advisory against south China's Guangdong Province and Hong Kong on May 23.

Only one new SARS case was reported between 10:00 a.m. May 30 and 10:00 a.m. May 31 on the Chinese mainland, the lowest since the country's SARS outbreak.

Questions?Comments? Click here

SARS Will Not Stop Growth of China's Economy

FM Spokeswoman: SARS Will Not Disrupt China's Economy

Chinese Crack Down on Public Spitting ( 2 Messages)

United States Afraid of its Own Shadow: Mahathir ( 8 Messages)

Int'l Community Aids China's SARS-control ( 6 Messages)

BBC Leader Criticizes US Coverage of War against Iraq ( 17 Messages)

US Interference in China's Internal Affairs Doomed to Failure: FM Spokeswoman ( 7 Messages)