China's economy will maintain a fairly quick growth in 2002, though it is hard to predict the economic outlook amid a slumping global economy, a top economic official said in Beijing.
"Whether China's gross domestic product (GDP) growth rate will surpass 7 percent next year depends on how China minimizes the negative impacts of world economic conditions and stirs domestic economic potentials," said Qiu Xiaohua, deputy director of the National Bureau of Statistics.
Qiu said the positive impact of the world economic slowdown on the Chinese economy should not be underestimated when making predictions for the outlook of the Chinese economy. That upside for China is that the world community is working so hard to resist stagnation, so governments of major nations will take quick and powerful action. That could create unprecedented favorable conditions for China to attract foreign direct investment (FDI).
Already, China saw FDI growth of 15.6 percent in the first three quarters of 2001 year-on-year, hitting US$42 billion.
Qiu predicted: "More international capital is expected in the next year if Chinese economy keeps growing."
Export, another major reflection of economic strength, also looks to surge in 2002.
The world slowdown will not necessarily cause sharp decrease of China's foreign trade. Rather, China's labor-intensive products still have the strength to compete in the world market, Qiu added.
He suggested more effort be placed in strengthening relevant trade policies and diversifying product varieties to sharpen the nation's competition edges.
Qiu also cautioned against excessive optimism, saying: "We should study the difficulties ahead with more wariness."
Then he said predictions of prosperity are warranted because of China's efficient domestic macro-economic policies, sound economic basis and deepening structural reforms.
The country has a range of economic stimulus means at its disposal to boost the economy next year.
They include State bonds issuances, interest rate cuts, tax cuts, salary hikes for civil servants, forex reserve employment, farmer income raises and social security reforms, Qiu said.
The continuity and stability of current macro-economic policies, proactive fiscal policies, moderate monetary policies and domestic consumption expansion policies will be maintained next year.
Qiu stressed the importance of stimulating non-governmental investment and lessening the direct involvement of the government in economic activities.
As the structural reforms proceed, many administrative approval systems are to be removed to facilitate non-governmental investment, which is not as vibrant as governmental investment in 2001.
Qiu concluded that the healthy capital market, which has experienced ups and downs over the past year, is also vital to ensuring upbeat economic development in 2002.
(China Daily December 22, 2001)
