Economy growth expected to continue
By Fu Jing (China Daily)
Updated: 2006-07-18 06:53
In addition to credit supply, Jia Yinsong, an NDRC official in charge of
economic operation, concluded that excessive growth in investment in fixed
assets, imbalance in foreign trade and price rises for raw materials are major
problems facing China's economic development.
"China's economy is on the right track on the whole but we need to take more
financial, credit, land and industry measures to solve problems we face," said
Jia.
China's investment in factories, bridges and other fixed assets jumped 30.3
per cent to 2.54 trillion yuan (US$318 billion) in the first five months of this
year, way ahead of the government's full-year target of 18 per cent.
Jia said that if the investment in redundant factories and real estate
projects ends up being unprofitable, the current surge in lending will result in
alarming financial problems.
Last week, the institute even urged the government to apply temporary tax
measures to overheated sectors in its report to the government. It also urged it
to raise interest rates at a "proper" time.
Lin said China would step up measures to increase imports
to correct its increasing foreign trade imbalance. Statistic indicate that
China's trade surplus rose to a monthly record high of US$14.5 billion in June
after reaching US$13 billion in May, up 49 per cent year-on-year.
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