Numbers of the Week

445

In the first quarter of this year, China set up 445 companies overseas, an increase of 6.8 percent from a year ago.

69.4 trillion yuan

The total assets of Chinese banks stood at 69.4 trillion yuan ($10 trillion) at the end of March, an increase of 25.1 percent from a year ago.

TO THE POINT:

China's economy is expected to regain momentum in the second quarter this year, although first-quarter GDP grew only 6.1 percent-the lowest growth in years. The country's tax revenue dropped for the sixth consecutive month in the wake of dismal company performances. But the good news was that foreign direct investment, foreign trade and fixed-asset investment, all indicated signs of national economic rebound. Consumer prices kept falling, making products more affordable for ordinary consumers. The airline industry, which suffered a huge loss of $3.7 billion last year, gained some momentum in the first quarter and earned $240 million.

By LIU YUNYUN

Major Economic Figures in the First Quarter

GDP

Officials believe the 6.1-percent GDP growth in the first quarter is a "better than expected" result, although it was the worst quarterly growth in years.

Li Xiaochao, Spokesman of the National Bureau of Statistics (NBS), said the sprawling global financial crisis took its toll on Chinese company performances and government revenue.

China has been used to a double-digit growth since 2003, so that 6.1-percent growth might seem like a recession, said Merrill Lynch in a report.

Market analysts have been debating whether the economy hit rock bottom in the first quarter.

Yao Jingyuan, chief economist of the NBS, said the downward trend of economy has been put on hold for the time being, but more forceful stimulus measures must be put in place to spur economic growth.

China's $585-billion stimulus package has boosted the national economy on a month-to-month basis.

Yao said the government is "confident" and "capable" of achieving its targeted 8-percent growth in 2009, citing recovered economic indicators such as a surge in auto sales, an investment boom and a rebound in exports.

CPI

The consumer price index (CPI), a barometer for inflation, dropped 0.6 percent in the first quarter year on year.

China's inflation has been easing since last April and fell into negative territory in February. In March, the CPI slipped 1.2 percent year on year.

Consumers in the country are now paying less for food, clothes and transportation.

Yet, many experts worry that the soaring number of bank loans in the markets might trigger a new round of price increases.

Li said the economic slowdown, stable prices in international markets, and ample agricultural product supplies would restrain price hikes in China.

Foreign trade

China's foreign trade volume secured a mild rebound in March, although the total value in the first quarter plunged 25 percent year on year to $429 billion. Exports fell almost 20 percent to $245.5 billion, while imports recorded a sharp plunge of 31 percent to $183.2 billion in the first three months.

In March, exports and imports both rebounded, growing 33 percent and 14 percent, respectively, compared to February.

The better-than-expected March trade figure proved the effectiveness of the government's stimulus package, part of which was to hike export tax rebates for backbone exporting industries.

But the gloomy international economic outlook still hovers over China's foreign trade. The country's top three trading partners-the EU, the United States and Japan-have fallen into the worst economic recession in half a century. If conditions continue to worsen, continued shrinking demand from those countries would severely batter China's exports in the long run despite a short-term recovery.

Moreover, rising trade protectionism, the appreciating Chinese currency and the financing predicaments of small and medium-sized companies are also affecting China's foreign trade.

FDI

China absorbed $21.78 billion in foreign direct investment (FDI) in the first quarter this year, down 20.6 percent year on year, the Ministry of Commerce said.

The number for March was $8.4 billion for a year-on-year drop of 9.5 percent but less than the decline in January and February. The recovering appeal for foreign investment bodes well for a rebound in the broader economy, said Yao Jian, a ministry spokesman, at a press conference.

Foreign reserves

By the end of March, China's foreign reserves totaled $1.9537 trillion, representing an increase of 16.14 percent year on year.

The foreign exchange reserve increase amounted to $7.7 billion in the first quarter, $146.2 billion less than the same period last year, the central bank said.