|Heavy industry becomes major engine for China's economy(11/27/03)|
With a fast growing economy, faster growing industry and an ever-increasing proportion of heavyindustry in the last two years, economist agree that heavy industry has become the major impetus for China's economy.
Guo Kesha, a researcher with the Chinese Academy of Social Sciences, predicted that industrial growth would contribute over 70 percent to the growth of gross domestic product (GDP) if the GDP growth reaches 8.5 to 9 percent this year.
China's economy, especially the manufacturing industry, would maintain rapid growth in the coming several years, said Guo, who also pointed out that acceleration of heavy industry was closely linked to the improvement of living standards and the transfer of international manufacturing industry to China.
"Increasing consumption is the major reason for the acceleration of heavy industry," said Feng Fei, an economist with the Development Research Center of the State Council.
Guo said Chinese people had begun to shift their consumption focus from food and clothes to houses and travel from 2000, and the increase in consumption resulted in the rapid growth of the car industry and the real estate industry, which in turn caused a large demand for iron and steel, equipment, chemicals and other products necessary for heavy industry.
Statistics show that production of car from January to September grew 87.2 percent over the same period last year, and nearly 70 percent of steel produced in 2002 was use by the real estate industry.
The real estate industry and the car industry, as well as the electronic information industry, have become the three new enginesof China's economy, said Qiu Xiaohua, deputy director of the National Bureau of Statistics, early this month at a forum on China's economic growth.