National Economy

In the first half of 2006, the Chinese economy saw fast and stable growth, the National Bureau of Statistics (NBS) said on July 18.

GDP. According to preliminary estimation, the gross domestic product in the first six months of this year totaled 9.14 trillion yuan, a year-on-year increase of 10.9 percent, which was 0.9 percentage point higher than the rate in the same period last year. Of this total, the added value of primary, secondary and tertiary industries stood at 828.8 billion yuan, 4.68 trillion yuan and 3.64 trillion yuan, up 5.1 percent, 13.2 percent and 9.4 percent, respectively, year on year.

Agriculture. The production of summer crops saw the third consecutive bumper harvest with the total output reaching 113.8 billion kg, up 7.4 billion kg or 7 percent more than that of last year. In the first six months, the total output of pork, beef, mutton and poultry arrived at 36.05 million tons, climbing 4.4 percent year on year.

Industrial production. From January to June, the added value completed by all state-owned enterprises as well as non-state enterprises with annual sales revenue of more than 5 million yuan was 3.97 trillion yuan, up 17.7 percent over the year-earlier period. In June alone, these enterprises completed added value of 781.8 billion yuan, growing 19.5 percent year on year. Of this total, the added value completed by state-owned and state-holding enterprises went up 11.8 percent and that by share-holding enterprises as well as Hong Kong, Macao, Taiwan and foreign-funded enterprises increased 18.7 percent and 19 percent, respectively, year on year. By industry, the added value of heavy and light industries grew 18.5 percent and 15.8 percent, respectively, compared with the same period last year (see graph 2). During this period, the sales ratio of all state-owned enterprises as well as non-state enterprises with annual sales revenue of more than 5 million yuan stood at 97.4 percent.

Fixed assets investment. In the first half of this year, fixed assets investment of the country totaled 4.24 trillion yuan, surging 29.8 percent compared with the year-earlier period. This growth was 4.4 percentage points higher than that in the same period last year. Of this total, the investment in urban areas reached 3.64 trillion yuan, shooting up 31.3 percent, 4.2 percentage points higher than the rate in the same period last year. Of the investment in urban areas, that in real estate development went up 24.2 percent to 769.5 billion yuan, 0.7 percentage point higher than that in the year-earlier period. From January to June, the investment in heavy and light industries surged 32.6 percent and 41.2 percent, respectively, over a year ago (see graph 3).

Retail sales. From January to June, the total retail sales of consumer goods reached 3.64 trillion yuan, rising 13.3 percent from a year ago. The real growth rate stood at 12.4 percent allowing for price fluctuations, 0.4 percentage point higher than a year ago. In June alone, retail sales of consumer goods went up 13.9 percent to 605.8 billion yuan. Of this total, retail sales of consumer goods in urban areas reached 2.46 trillion yuan, up 14 percent. Sales in rural areas jumped 12 percent to 1.18 trillion yuan. The sales volume of the wholesale and retail sector was 3.08 trillion yuan, up 13.4 percent, and that of the accommodation and catering sector reached 492.9 billion yuan, increasing 15.3 percent year on year. Sales of communication equipment went up 25.5 percent year on year; oil and oil products, 38.4 percent, and automobiles, 27.7 percent.

Price. In the first six months, the consumer price index rose 1.3 percent compared with the year-earlier period. It was 1 percentage point lower than a year ago. In June alone, the index increased 1.5 percent. Prices went up 1.3 percent in cities and 1.2 percent in rural areas (see graph 4). In the first half of this year, the retail prices of consumer goods inched up 0.8 percent year on year.

The producer price index for manufactured goods rose 2.7 percent over the year-earlier period and in June, the index grew 3.5 percent. In the first six months, purchasing prices of raw materials, fuels and power jumped 6.1 percent compared with the same period a year earlier. In June alone, they rose 6.6 percent. Housing prices in 70 large and medium-sized cities went up 5.6 percent, which was 3.3 percentage points lower than the growth in the same period last year. In June, housing prices increased 5.8 percent over a year ago.

Household income. In the first half of this year, the per-capita disposable income of urban residents was 5,997 yuan, a year-on-year increase of 10.2 percent in real terms allowing for price fluctuations, 0.7 percentage point higher than that in the same period last year. The per-capita cash income of rural residents was 1,797 yuan, up 11.9 percent year on year in real terms, which was 0.6 percentage points lower than the growth in the year-earlier period.

Prominent problems existing in economic life are: It is more difficult to increase the income of farmers; fixed assets investment is excessive; the credit is oversupplied and, due to price hikes of raw materials, fuels and power, the margin for profits of some industries shrank. However, national economic development for the whole year is expected to maintain fast and stable growth, said the NBS.