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Economy in Recovery, Internal Demand still Needs to be Expanded
The macro economy of China is in recovery, thus reversing the situation of slowing down of its growth rate.
The stepping up of the structural adjustment, the development in western areas and the pending entry into WTO, all these factors have combined to inject new vitality into the development of industrial production. The first five months saw a growth by 11% as against the same period of last year, two percentage points higher than that of last year.
The export is in evident recovery. The improvement of international economy, the policies by the government to encourage foreign trade have brought about a 39% rise in export volume and continuous expansion of favorable balance in foreign trade.
The declining situation of foreign investment has taken a turn for the better, the contract value of direct foreign investment projects in the first quarter seeing a rise by over 20%.
The domestic market is also in the course of picking up, due to the effects of wage reform and holiday extension, the retail consumption value rose by 10% during the first five months. And along with it, the sale of productive materials has seen a brisk development with a rise of 14% in trade volume. As a consequence, shortage in transportation and power supply tended to be serious again in some areas.
The national debts, the deepening of adjustment of investment and finance system and the release in the limitations for market entry are promoting the expansion of investment. The investment growth rate of first five months is 9.5%. The market price has also shown signs of pickup. Pulled by international oil price rise and demand recovery, the price of means of production has stopped going downhill and begun to rise. The decline in the price of consumer goods during the first five months has loosened its pace, keeping at the same level as in the same period of last year.
The recovery of macro economy is attributed to both macro policy of expanding internal demand and pickup of global economy.
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