TNAG-2792-FCO40-4031-Relations-between-Hong-Kong-and-China-1993 — Page 52

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CONFIDENTIAL

機密

CRC INF 12/93 (CEC 7/93)

Summary of Major Developments in China's Economy and Hong Kong China Economic Relations

in the Second Quarter of 1993

(1)

China's

economy

showed clear indications

of

(2)

(3)

(4)

overheating in the second quarter of 1993. For the

first half as a whole, the real growth rates of gross

domestic product and gross industrial output, at 13.9%

25.1% respectively, exceeded considerably the

corresponding annual growth targets of 8-9% and 14% as

stated in the current five-year plan (paragraphs 1

to 3).

and

The substantial increase in fixed asset investment was

providing the main impetus to growth (paragraph 5). A loose monetary and credit position, in a financial

sector which was very much underdeveloped and liable

been accommodating the investment boom

to

abuse, had

(paragraph 11).

Underpinned by a substantial rise in workers' payroll,

consumer spending also showed a strong increase lately

(paragraph 6). In the first half of 1993, retail

sales grew by 21.6% in value terms or about 10.5% in

real terms. The latter increase nevertheless remained

that of 22.2% in light industrial output.

Thus, quite unlike the previous economic boom in

1987

88, there was still no shortage in the overall

supply of consumer goods against demand.

slower than

The

national inflation rate continued to accelerate,

from 8.6% in the first quarter of 1993 to 12.4% in the

second quarter. Inflation was consistently higher in

the major cities, averaging at 15.7% and 19.1%

respectively in the first two quarters (paragraph 7).

CONFIDENTIAL

機密