In the first quarter of this year, regions and departments at all levels carefully implemented various macroeconomic policies set by the national economic working conference and the third plenary session of the 10th National People’s Congress by further establishing the scientific concept of development, enhancing macro regulation, pushing forward reform and opening-up and constructing a harmonious society. National economic performance starts well.

According to preliminary estimation, the gross domestic product (GDP) of China in the first quarter of this year was Rmb3,135.5 billion, a year-on-year change of 9.5%, it was 0.3 percentage points lower than the growth rate for the first quarter of 2004. Of this total, the value-added of primary industry was Rmb228.7 billion, up by 4.6%; the value-added of  secondary industry was Rmb1,836.6 billion, up by 11.3%; and the value-added of tertiary industry was Rmb1,070.2 billion, up by 7.6%. The national economy maintained a momentum of stable and rapid growth.

1. Agricultural production was good. Survey results showed that farmers were enthusiastic in grain production in 2005, and the expected planting areas for grain is expected to reach 1,558 million mu (1.04 million hectares), a year-on-year increase of 2.3%. Of this total, the planting areas for summer grain were 395 million mu (26.33 million hectares), up by 4.8%, reversing the trend of declining for consecutive 7 years. At present, the winter wheat was growing well, and the soil moisture content was good.

2. Rapid growth was seen in industrial production. In the first quarter of this year, the total value-added of the industrial enterprises above designated size was Rmb1,441.5 billion, a year-on-year growth of 16.2 percent over the same period last year. The growth of heavy industry was 16.3% while that of light industry was 16%. Analysed by product, power generation and the production of coal and rolled steel were up by 13%, 9.1% and 22.4% respectively, the production of microcomputers, mobile phones and fax machines rose by 57.5%, 23.9% and 34.1%. The production of motor vehicles went up by 1.6%, of this total, that of the cars declined by 2.8%.

Profits made by industrial enterprises continued to increase. In the first 2 months of this year, the profits made by industrial enterprises above designated size stood at Rmb165.3 billion, a year-on-year change of 17.4%. Of this total, that of the state-owned and state-holding enterprises increased by 14%.

3. Rapid growth was recorded in the investment in fixed assets. In the first quarter of this year, the investment in fixed assets of the country was Rmb1,099.8 billion, up by 22.8%, or a decline of 20.2 percentage points as compared with the growth in the same period last year. Of this total, investment in urban areas reached Rmb903.7 billion, up by 25.3%; that in rural areas was Rmb196.2 billion, up by 12.7%. Of the total investment in urban areas, the investment in real estate development was Rmb232.4 billion, up by 26.7%. In terms of different sectors, the investment in agriculture, energy and transportation has been enhanced. The investment in agriculture, forestry, animal husbandry and fishery increased by 39.9%, that in coal mining and washing went up by 86.1%, that in electricity, gas and water production and supply was 44% and there was a 4.3-fold growth for investment in railways. Investment in the cement and metallurgy sectors was put under continuous control. The investment in non-metal products, and in non-ferrous metal dressing, smelting and pressing industry declined by 2.9% and 1.4% respectively. The investment in ferrous metal dressing, smelting and pressing was up 6%.

4. Domestic markets were fairly brisk. In the first quarter of this year, the total retail sales of consumer goods reached Rmb1.511.2 billion, a year-on-year rise of 13.7%, or a real growth of 11.9% if price factors were deducted, or 2.7 percentage points higher than that in the first quarter of 2004. Of this total, total retail sales in cities reached Rmb1,009 billion, up by 14.7%, that of county and below county level stood at Rmb502.2 billion, up by 11.7%. In terms of different sectors, the sales by wholesale and retail business was Rmb1,261.6 billion, up by 13.6%, and that by catering industry, Rmb206.3 billion, up by 17.2%.

5. Market prices rose moderately. China registered a year-on-year rise of 2.8% in total consumer price level in the first quarter, of which, price rose by 2.5% in cities and 3.5% in rural areas. In terms of commodity categories, prices for food rose by 6.1%, housing prices were up by 5.6%, and prices for entertainment, education and culture articles and services rose by 2.6%. Prices for other categories of commodities either maintained the same level or had slight decline. The retail prices of commodities rose by 1.6% year on year in the first quarter. The prices for fixed assets investment rose by 1.8%. The producer’s price index for manufactured goods rose by 5.6%. The purchaser’s price for raw material, fuel and power rose by 10.1%.

6. Export continued to grow rapidly and foreign direct investment continued to increase. The total value of import and export for the first quarter was US$ 295.2 billion, up 23.1% year on year. Of this total, export value was US$ 155.9 billion, up by 34.9% and import US$ 139.3 billion, up 12.2%. The trade surplus was US$16.6 billion. The total contracted value for foreign direct investment in the first quarter was US$ 35.2 billion, a year-on-year rise of 4.5%. The total value of foreign capital actually utilized was US$ 13.4 billion, up by 9.5%. By the end of March, China registered a total of US$ 659.1 billion in foreign exchange reserves, an increase of US$ 49.2 billion over the end of last year.

7. Urban and rural residents’ income kept relatively rapid growth. In the first quarter, the per capita disposable income of urban residents was Rmb2,938, up by 11.3% year-on-year or 8.6% of real rise if price factors were deducted. The per capita cash income of rural residents was Rmb967, up by 15.9% year-on-year, or 11.9% growth in real terms.

The above statistics show that the national economy continued to develop in the expected direction of macro-regulation and control. The overall situation is upbeat. However, it should be noted that, it is a hard job to maintain agricultural growth and the increase of farmers’ income; the total size pf investment is too large; the shortage of coal, electricity, petroleum and transportation is still prominent; the price for some up-stream products rose at a bigger margin than desired; and the task of macroeconomic regulation and control is still arduous. At present, we should continue to guide the overall economic and social development by a scientific outlook on development; to make reform and opening up as the driving force; to keep the policies consistent and to go all out to implement them. Macroeconomic regulation and control should be meticulously implemented in order to consolidate and strengthen the good momentum of national economic performance.