China 2007

China 2007

Chinese economy expanded by 11.4% YOY to $3.4 trillion …5th consecutive year of double digit growth, retaining 4th position after US, Japan and Germany. This is a combined result of investment boom, a record trade surplus and pickup in consumption.

Trade surplus ballooned to $262 billion (up 47.7%)

Urban fixed asset investment growth was 25.8 %( 24.3% in 2006)

Retail sales growth rose 16.8% (from 13.7% in 2006)

Industrial output increased by 18.5 %( up 1.9% over 2006)

Inflation surged to 4.8% (from 1.5% in 2006). Peoples bank of China raised interest rates 6 times during 2007. CRR was raised 10 times to a record high of 14.5%.

Grain production reached bumper production 502 million tons…4th consecutive year of high production.

Trade volume increased 23.5% (slightly down from 2006)

Disposable income of urban residents rose 9.8% to $1900 and net cash income of farmers rose by 6.8% to 572$.

Unemployment rate dropped to 4% (from 4.1% in 2006). The country created 51 million employment opportunities.

Number of college students rose by 20% to 17.4 million.

Total installed electricity generation capacity increased 350 million kW.

28000 km of highways were built.
Energy consumption / unit of GDP were brought down by 3% and SO2 and chemical oxygen dropped 1st time.Income tax for both Chinese funded and foreign funded enterprises will be same at 25%.Labour Contract Law and Employment Promotion law adopted for protecting rights of the people."Made in China" phrase suffered from unprecedented "crisis of confidence" in 2007. Recall of China made toys by "Mitel Inc." triggered the fuse...products ranging from tooth paste to food. Four month nation wide campaign launched to restore confidence.

Economy is expected to slow down to 10% GDP growth, in 2008. Central government implemented series of administrative measures to cool down economy, reduce over dependence on export and move to more sustainable domestically driven growth.