Beyond the rosy China stats: Problems
By Macabe Keliher
HONG KONG - China's official economic growth figures are out, and while they do tell of a strong economy fueling much of the regional and even world-wide growth, they also point to tremendous production capacity, which, some economists say, the system cannot support.
The Chinese economy grew 9.1 percent last year, its fastest in seven years, to 11.67 trillion yuan (US$1.4 trillion), according to the National Bureau of Statistics. After a strong first quarter of 9.9 percent growth, the SARS crisis slowed the second quarter down to 6.7 percent. But the economy quickly recovered as foreign direct investment continued to flood in, driving third and fourth quarter growth to 9.6 percent and 9.9 percent, respectively. It was the strongest annual growth rate since 1997.
Such growth accounted for 16 percent of the world's 2.5 percent economic growth in 2003, according to a United Nations report last week. China, it said, "will benefit the world economy as a whole".
Regionally, Beijing likes to say it has pulled its neighbors out of the financial crisis to new prosperous beginnings. China currently runs a trade deficit of $43.4 billion with Asia, and a combined deficit of almost $60 billion with Taiwan, Japan and South Korea. "China's growth promoted the ASEAN [Association for Southeast Asian Nations] economic recovery," says a Chinese Foreign Ministry official who asked not to be identified. "A healthy percentage of ASEAN growth is based on China."
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