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the first half

bottleneck sectors

flooding(9)

The shortfall in the

of 1991(9).

was further exacerbated by the recent

since several flood-stricken provinces in

central and eastern China were important producers of silk

and cloth). Reportedly, many textile plants had been

running at half capacity due to

the shortage of raw

materials,

particularly cotton.

Constraints in the

sectors would give

rise to increased

bottleneck

inflationary pressures in the short term and impede the growth of China's economy in the longer term.

6.

the

Somewhat unexpectedly, the flood had not affected

summer harvest too seriously.

Total

output

of

(8)

year-on-year growth rate in real terms of:

1991 01 1991 02 1991 H1

(%)

(%)

(%)

Gross industrial output*

13.7

13.1

13.4

of which:

Energy

Electricity

9.5

7.4

8.4

Raw coal

-0.4

-1.1

-0.7

Crude oil

1.0

2.1

1.6

Raw materials

Pig iron

10.2

5.1

7.6

Steel

6.1

2.8

4.4

Cloth

-4.0

0.8

-1.5

Silk

1.3.9

7.6

10.6

* Excluding output from the village-run enterprises.

(9)

An

assessment of the impact of the flooding on China's economy can be found in CEC 10/91 "A Note on the Economic Impact of the Natural Disasters in China in 1991", which was circulated to members on 22.7.91.

(10) Heavy rain and floods have struck particularly hard the following eight provinces: Jiangsu, Auhui, Henan, Hubei, Sichuan, Guizhou, Hunan and Zhejiang. In 1989, these eight provinces accounted for 82.3% of China's total silk output and 47.5% of its cloth production.

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