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China's Economy Grows - 2002-01-16

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China's government says its economy will continue growing briskly this year, even though much of the rest of the world is in an economic downturn. Chinese officials say they will boost internal demand, encourage investment, and push reforms to help sustain growth.

In a rare meeting with reporters, the China's top economic planner, Zeng Peiyan says the world's "complicated and volatile" economic problems could make growth more difficult for China. He says the war on terrorism and a slowdown in trade make it harder for China's manufacturers to export their goods.

Speaking through a translator, Mr. Zeng said China's economy grew at about 7.3 percent last year and will grow at a similar pace this year. Mr. Zeng said, "Facing this situation, some friends may ask, 'when the world economic situation is not very good, can China still maintain last year's growth?' My answer is that we can continue to do so in the new year."

China's growth rate slowed for much of last year, but Mr. Zeng says he is "full of confidence" that China can continue the economic growth that has transformed much of the country.

He says internal demand was up about 10 percent last year and urban incomes grew more than eight percent. Mr. Zeng also says foreign trade and foreign capital utilized both hit record highs for China.

Mr. Zeng says this year China will encourage consumers to buy cars, build houses, go to school and take tours to boost internal demand.

He says the government will further stimulate the economy by issuing bonds to raise money to bring paved roads, electricity and other services to poverty-stricken areas in China's west.

Many economists have noted in the past that government spending has been responsible for most of China's growth in the past few years.

Mr. Zeng says China's new membership in the World Trading Organization will afford exporters new access to other markets, and clear away tariff and other obstacles to China's market. He says the result will be an increase in foreign and domestic investment in China, which will help growth.

Twenty years of economic reform and opening up to the outside world have more than doubled the size of China's economy and greatly increased the incomes of urban residents.

Some analysts say that phenomenal economic growth is a key reason the communist party still rules China at a time when most other communist governments have been replaced. Scholars say continued economic growth is important because it is a key to social stability in China by absorbing some of the country's millions of unemployed workers.

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