Further growth faces challenges
(Shenzhen Daily/Agencies)
Updated: 2006-01-27 08:46

When China joined the World Trade Organization (WTO) four years ago, it feared the “wolf” had come — foreign investors ready to eat up its economy. A year later, China and the wolf were dancing together. Now, they’re married, but a senior Bank of China executive said this does not mean the marriage will last forever in bliss.

Zhu Min, the State-owned bank’s executive assistant president, noted that 50 percent of marriages in the United States end in divorce and what happens in the future will depend on how China and foreign investors cooperate in meeting difficult challenges, especially in the newly opened financial sector.

“When we joined the WTO, we always talked about the wolf has come, we’re scared to death,” Zhu said Wednesday. “A year later, we talked about dancing with the wolf ... Now we marry ... the wolf” and the situation is very different.

China’s booming economy and prospects for investment were high on the first day’s agenda at the World Economic Forum in Davos, Switzerland the annual gathering of the world’s top business and government leaders.

Zhu predicted that China’s economy will grow between 8.8 percent and 9.3 percent this year “because the whole economy is pretty healthy and strong ... domestic consumption really picked up and domestic construction is very strong.”

“I would say Chinese GDP (gross domestic product) is still underestimated,” he added, pointing to “millions” of small and medium-sized businesses that were not accounted for in domestic economic data. “There is still room for China to grow.”

But Cheng Siwei, vice chairman of the standing committee of the National People’s Congress, said in China’s new five-year program to be approved in March “our goal is around 8 percent” growth to allow for greater investment in improving life for the country’s 1.3 billion people.

China has become the third-largest trading nation and the third-largest recipient of foreign investment, but its per capita income is still lower than 100th in the world, China’s Vice Premier Zeng Peiyan said in an address to the forum.

“The world economy is facing an increasing number of destabilizing and uncertain factors — fiercer international competition, rising trade protectionism, an unfair economic order and a widening gap between the north and the south,” he said.

Zeng called for greater global cooperation to combat global poverty and improve life for millions in China and around the globe.

“China cannot develop in isolation, nor can the world develop without China,” he said.

In the new economic and social plan, Zeng said China’s first goal is to double the year 2000 per capita income by 2010, achieve greater efficiency in using resources and energy and curb ecological and environmental degradation.

Cheng said China’s urban dwellers have become three times richer than their rural counterparts, and people in the east and along the coast are much richer than those in the west, so greater efforts must be made to narrow the gaps and “keep economic progress synchronized with social progress.”