An Analysis of China's Current Economic Outlook
China, having initiated many economic and market reforms in recent years, is seen by some analysts as having also implemented a new economic model that is socially as well as economically successful. Li He, an economist with extensive expertise in Chinese affairs, stated that since the 1970s, China has experienced a gradual and ongoing shift from a centrally planned economy to a market system; these reforms, said He, "have resulted in fast and continuous growth." It is the purpose of this report to examine China's current economic outlook, drawing upon primary as well as secondary sources to profile an economy that has acquired substantial amounts of foreign direct investment (FDI) as it transforms itself from a largely agrarian economic base to one emphasizing industrial and manufacturing as well as entrepreneurial activities.
The National Bureau of Statistics of China identified Gross Domestic Product (GDP) data for the four quarters of 2004 as follows:
Absolute Value, Yuan Growth Rate
(100 million Yuan) over Prev. Yr.(%)
Gross Domestic Products 136515 9.5
Tertiary Industry 43384 8.3
These data were augmented by comments from the U.S.-China Business Council which noted that "China's controlled economic stabilization is unquestionably underway." The US-CBC called for continued monitoring of financial sector reform, oil prices, revitalization and development of the Northeast region of the country, and attention to environmental problems. Overall, the US-CBC credits the Chinese government with having taken many important steps to ensure that value-added industrial output, fixed-asset investment, and exports would improve while the consumer price index (CPI) would remain relatively stable.
A communiquT released by Li Deshui, the Chinese Commissioner of the National Bureau of Statistics in late January 2005, attributed Chin...