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SARS didn't disrupt China's growth cycle, economist says (14 July 2003) China Online China’s economy is expected to grow over 8 percent in the first half of 2003, indicating that the SARS outbreak did not disrupt the new growth cycle this year. China’s economic growth is mainly propelled by investment and exports on the demand side and industrial production on the supply side, according to a Monday Xinhuashe (Xinhua News Agency) report. As these three indicators have not shown signs of decline, the “fast growth” momentum of the national economy will not be stalled, the report quoted Chen Dongqi, an economist with the National Development and Reform Commission, as saying. Official forecasts show that China’s investment and exports both expanded by more than 30 percent in the first six months, with the growth rates higher than a year earlier; and industrial production rose by 16.2 percent, with profit growth higher than usual. China’s overall investment went up 31.6 percent in the first quarter. After a slowdown to 28.4 percent in April, the growth regained momentum to reach 34.5 percent in May, indicating that the outbreak of severe acute respiratory syndrome (SARS) had little impact on the sector, the report noted. And the growth of government direct investment is expected to accelerate in the second half of the year, it added. Meantime, exports maintained steady growth, 33.5 percent in the first quarter, 33.3 percent in April and 37.3 percent in May. Although the growth of industrial production slowed down from 17.2 percent in the first quarter to 14.9 percent in April and 13.7 percent in May, it recovered to 16.9 percent in June. The report quoted experts as saying that China will see a V-shape growth curve this year, with lower growth rates in the middle sandwiched by higher growth at both ends. China’s gross domestic product (GDP) expanded 9.9 percent in the first quarter and is expected to grow 6.5 percent to 7 percent in the second quarter. However, the experts warned against rising unemployment as an aftermath of SARS, continual falls in farmers’ income, a resurgence of high-energy-consumption industries and overexpansion in credit supply, key issues to be tackled in the second half of the year. |
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