BEIJING - China's
higher-than-expected economic growth and inflation
in the first quarter of this year has fueled
worries that the government may impose more
macroeconomic control measures, including raising
interest rates, to cool down the sizzling economy.
China's gross domestic product (GDP) grew
11.1% in the first quarter of this year to total
5.03 trillion yuan (US$653 billion), according to
the latest figures provided by the National Bureau of
Statistics (NBS) on Thursday.
The growth was 0.7 percentage points
higher from a year ago, and 0.4 percentage points
higher than that in the whole of last year.
According to the bureau, China's consumer
price index (CPI), a major inflation index, grew
by 2.7% in the first quarter, 1.5 percentage
points higher than the same period of last year.
But the CPI rose 3.3% in March year-on-year,
showing inflation tends to accelerate.
The
rapid economic growth was driven by investment,
consumption and import and export, said Li
Xiaochao, spokesman for the NBS, citing
consumption in particular, which grew in an
impressive way in the first quarter.
But
at a press conference in Beijing, Li evaded the
question about whether the Chinese economy is
overheated, saying it is a comprehensive problem,
and to judge whether it is overheated, the
GDP-growth indicator alone is not enough. But Li
warned that now there is a risk for the economy to
evolve from fast growth to overheating.
The three-month period saw a quicker
growth in retail sales together with a slower
growth in investment, which was seen as a
healthier development for the fast-growing
national economy, according to Li.
The
nation's retail sales were up 14.9% year on year
to 2.12 trillion yuan (US$275.2 billion), with the
increment 2.1 percentage points higher than a year
earlier.
Fixed-assets investment amounted
to 1.75 trillion yuan ($227.6 billion), up 23.7%,
which was four percentage points slower than the
same period of last year.
Of the total,
the real estate sector witnessed an investment of
354.4 billion yuan in the first quarter months, up
26.9%, 6.7 percentage points higher than the same
2006 period. The country invested 246.2 billion
yuan in building houses, up 30.4%, 7.3 percentage
points higher than the rise at the same time last
year.
Between January and March, China
realized $457.7 billion in foreign trade, up
23.3%. In the breakdowns, exports totaled US$252.1
billion, up 27.8%, and imports $205.7 billion, up
18.2%. The trade surplus reached $46.4 billion,
$23.1 billion more than the same period of last
year.
China actually used $15.9 billion in
foreign direct investment in the first three
months, up 11.6%. By the end of March, the
country's foreign exchange reserves stood at $1.2
trillion, an increase of $135.7 billion from the
end of 2006.
In the first quarter, urban
residents had their per-capita disposable income
rise 19.5%, or 16.6% in real terms, to 3,935 yuan,
and the cash income of rural dwellers up 15.2%, or
12.1% in real term, to 1,260 yuan.
Following the release of the statistics,
Premier Wen Jiabao said the Chinese government
should promptly take economic and legal measures
to strengthen macro control in order to prevent
the economy from overheating.
Chairing a
cabinet meeting, Wen said the economy has
developed satisfactorily in the first quarter of
this year but "some key problems still remain".
China should curb the fast growth in
products that consume too much energy and lose no
time in eliminating outdated production methods.
To prevent fixed assets investment from
rebounding, stricter market access and
environmental standards should be set for new
construction projects and land use should continue
to be tightened, Wen said.
Wen also said
China should clear up policies that give exports
inappropriate preferences and expand its imports
of advanced technology and equipment.
Analysts say Wen's remarks suggest the
central government will tighten its macroeconomic
controls but measures to be taken are likely to be
moderate so as to prevent a sharp downturn of the
economy.
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