Economic recovery remains strong

(Xinhua)
Updated: 2009-09-11 21:34

BEIJING: China's economy is on a track of quick recovery as major economic figures soared in August.

Figures from the National Bureau of Statistics (NBS) showed on Friday the country's industrial output grew 12.3 percent in August from a year earlier, 1.5 percentage points up from July.

Fixed-asset investment also increased in the first eight months. It rose 33 percent from a year earlier, and the growth rate was 0.1 percentage point higher compared to the first seven months of this year.

"Major data shows a more clear sign that the country's economy began to recover. This will ensure the economic growth target of 8 percent for the whole year," said Li Xiaochao, spokesman of the NBS, at a press conference.

Rising retail sales reflected an acceleration in China's social consumption. Retail sales grew 15.4 percent in August to 1.01 trillion yuan ($148.1 billion) from a year earlier. The growth rate was 0.2 percentage point higher than July.

Zhang Liqun, a researcher with the Development Research Center of the State Council, told Xinhua: "Rising investment and consumption data indicated an increasing demand from the domestic market, which contributed to maintaining the rising momentum."

Premier Wen Jiabao said at 2009 Summer Davos in Dalian on Thursday that the unprecedented global financial crisis has taken a heavy toll on the Chinese economy. Yet, China has risen to challenges and dealt with the difficulties with full confidence.

In comparison with a rising domestic demand, weak demands from overseas markets still placed a big pressure on the country's foreign trade and the overall economy, but analysts believe the situation will turn better.

China's foreign trade figures continued to fall in August, but the downward rate slowed, the General Administration of Customs said Friday.

The imports and exports value of August was $191.7 billion, a decrease of 20.6 percent compared with the same month last year, but a 2.3 percent increase from July.

Zhuang Jian, a senior economist with the Asian Development Bank, said the trade figures reflected that China's foreign trade is still weak amid a slowdown in international demand, but it had shown signs of recovery.

"As the country's economy is on a track of recovery boosted by stimulus measures, foreign trade is expected to improve gradually," said Zhuang.

To boost the economy in the face of difficulties and challenges, the Chinese government launched a basket of stimulus plan last September and reiterated its stance of maintaining the proactive fiscal policy and moderately loose monetary policy several times.

Under the moderately loose monetary policy, the country's banking sector extended more loans this year to aid the economic growth.

The People's Bank of China, the central bank, said Friday China's new yuan-denominated lending in August rose to 410.4 billion yuan from July's 355.9 billion yuan.

The August figure brought new yuan-denominated loans in the first eight months to 8.15 trillion yuan, 5.04 trillion yuan more than the same period last year.

As surging loans have sparked inflation worries, Li Xiaochao said the country did not face inflation currently, as both the major gauge of inflation and the major measurement of inflation in wholesale continued to drop in August compared with the same month last year.

China's consumer price index (CPI), dipped 1.2 percent in August from a year earlier; while the producer price index (PPI), fell 7.9 percent compared with the same month last year, according to the NBS.

Despite the achievements in economic growth, Li underscored the severe situation in the international markets, which still challenge the country's economy.

"With many uncertainties remaining in the prospects of the world economy, we still face tremendous pressure with the decline in external demand," Premier Wen said.