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Economy to grow steadily despite problems
(Xinhuanet)
Updated: 2005-08-14 10:48
Despite low consumer price index and industrial profit drop, China's economy
is believed to grow steadily for the second half of 2005.
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| A
general view of Shanghai's Pudong business zone is seen in this
photo taken at the waterfronts of the Huangpu River on July 28,
2005. [newsphoto] | Instead of slowing down as
expected, China's economy engine maintained a strong momentum, with a 9.5
percent growth in the second quarter, even a little higher than the first
quarter.
Along with the fast growth rate, China's economy suffers low consumer price
index (CPI), slumping industrial profit and overgrowing foreign exchange
reserve, which might affect the stability of the economy.
Overall, the economy is moving for the better, said Xie Fuzhan,deputy
director with the Development Research Center of the State Council.
In the first half, the industrial profit rose by 16 percent, much lower than
40-percent increase last year.
"But there is no signal for any danger as China aimed to cool down its
overheated industries," said Xie.
The first two quarters saw a mere 2.3 percent increase of the CPI, 1.3
percentage points lower from the same period last year, which aroused public
worry about a possible deflation.
Zhong Wei, financial expert with Beijing Normal University, believed
deflation is not likely to occur this year, but "it is looming up and next
year's price rise may come at a standstill".
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