CE 396
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target.
Stimulated by more investment
(6)
and higher
prices, agricultural production, particularly of cash crops like cotton, sugar-bearing crops, tobacco, fibre crops and fruit, is expected to soar in the second half of
1988.
7.
Estimated at Rmb 67.8 billion, the amount of investment in fixed assets undertaken by state-owned enterprises in the first half of 1988 was 14.2% more than
in the same period of 1987. However, this increase might only be a reflection of rising prices as, in terms of the number of new projects costing in excess of Rmb 50,000 which were started, there were only 9 254 in the first half of 1988, 401 less than in the same period last year.
8.
Rapid economic growth and consumers bringing forward some of their purchases because of their worry about further increase in prices in the near future led to a consumption boom in the first half of 1988. The value of retail sales, estimated at Rmb 344.5 billion, was 24.6%
higher than in the first half of 1987. Discounting the effect of higher prices, the growth rate in volume terms of retail sales in the first half of 1988 was about 10%.
9.
Inflationary pressure mounted further in the first half of 1988. The year-on-year rate of increase in retail prices in China in the first half of 1988 was officially put at 13%. The corresponding rate of increase in 32 large and medium sized cities was higher at 14.4%.
(6) Chinese farmers bought Rmb 44.7 billion worth of
production means (i.e. agricultural machinery and agricultural input like fertilizers) in the first half of 1988, representing an increase of 24.3% over the same period in 1987. The output of chemical fertilisers and small-sized tractors also rose by 10% and 27%.
CONFIDENTIAL # 3
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