China’s economy will grow rapidly during the next 30 years, despite a slight slowdown at present, Fan Gang, a well-known economist and member of the Monetary Policy Committee of the People’s Bank of China (PBOC, the central bank) told an economic forum here on Wednesday.
Higher productivity had been a major factor in China’s economic growth and would continue to play a role in the coming decades, Fan said.
Delivering a review of three decades of reform and opening up policies that were instituted in 1978, Fan said market-oriented reforms, education and research, opening to foreign investment and urbanization had helped drive productivity growth.
“The effects of those factors will persist in the next 30 years. That’s why I’m confident” of China’s continued growth prospects, he said.
Rising productivity had contributed about 40 percent of China’s average annual 9 percent growth from 1999 to 2005, with investment and human capital accounting for the remainder, said Fan.
Although labor might become scarcer and costlier over the next three decades, the delayed effect of education and research would play a bigger role, he said.
“The share of foreign investment in total investment is dropping, but the knowledge China gained from foreign-funded enterprises will be of more use in the future,” said Fan.
Fan didn’t give specific figures on the changing relationship between foreign and domestic capital, and the government doesn’t break down total investment in that manner.
Meanwhile, there was still much room for further reforms in government efficiency, state-owned enterprises, pricing mechanisms and the financial and tax systems, which could unleash further economic dynamism, Fan said.
“China has finished only half or less of its reform journey,” he said.
Gross domestic product (GDP) expanded 11.9 percent last year, the fifth year of double-digit growth. However, GDP grew 10.6 percent in the first quarter, down 1.1 percentage points year-on-year, on weakening external demand and the worst winter storm in more than five decades.
“Growth only slowed a little; [the economy] was not in stagnation. It was still running at double-digit speed,” China Business News quoted Fan as telling reporters at the forum.
A report released by Renmin University of China and Donghai Securities earlier this week said the economy was decelerating from a record growth pace.
It forecast the economy would grow at a slower annual rate of 10.4 percent in 2008 because of the deteriorating external environment and the domestic tightening policy.
The World Bank last week raised its forecast for China’s 2008 economic growth to 9.8 percent from 9.4 percent, down from the 10.8 percent forecast made in mid-2007.

(Xinhua) — China’s industrial firms reported 1.09 trillion yuan (158.6 billion U.S. dollars) in profits in the first five months of this year, up 20.9 percent from the same period last year, the National Bureau of Statistics (NBS) said on Friday.
The growth rate was 4.4 percentage points higher than figure for January and February, but 21.2 percentage points lower than the first five months of last year.
The NBS statistics covered the profits of major industrial enterprises defined as those with more than 5 million yuan in revenues from their main business annually.
The NBS said the profits of state-owned industrial companies only rose 1.5 percent to 424.6 billion yuan, largely affected by the weak energy and oil refining sectors.
Power utilities’ profits fell 74 percent year-on-year. Oil refineries and coking plants moved to a loss of 44.3 billion yuan from a profit of 35.2 billion yuan at the same time last year.
But other sectors, including oil, gas, coal and construction material production, saw profits surge more than 50 percent. Profits of steel companies rose 25.6 percent and those of chemical plants rose 26 percent.
The NBS also reported profits for privately-owned industrial firms were up 51 percent and foreign-funded companies up 22.4 percent.

Xinhua) — China must boost the development of a medium and long-term investment and financing market to build a highly efficient financial system, according to Chen Yuan, governor of China Development Bank.
Chen said Friday at the 6th China M&A Annual Conference held in Shanghai that a medium and long-term investment and financing market is one pillar of the financial system and an important fund channel for local economic development and large-scaled enterprises.
“As a developing country, China’s urbanization would last for more than 100 years,” said Chen, adding that long-term construction needs huge capital input.
Meanwhile, he urged that in building such a market, the government, market and financial agencies should collaborate closely. Financial institutions need to improve their competitiveness by strengthening internal risk control and relying on good services and innovation.
Cui Jindu, vice mayor of Tianjin Municipality, said at the conference that China needs to push forward financial innovation in face of global financial uncertainties, adding that if China did not take an active role in the process of financial globalization, more risks would be involved.

Auburn Hills, Mich. - “Concept to reality” has become a term that epitomises the Chrysler Group design philosophy, and many observers are hoping that it will apply to the company’s concept vehicles for 2007.

Chrysler Group’s latest concept vehicles clearly demonstrate a design tradition that has become a key strength of the company: an ability to design the coolest-of-cool concepts, which are as relevant as they are innovative.

This approach started with the Frankfurt Motor Show reveal of the Lamborghini-engined, cab forward-styled, four-door Chrysler Portofino concept sedan in 1987. Almost 20 years and more than 100 concepts later, this continuous development has helped Chrysler Group reinvent and maintain its reputation as a car company driven by design and engineering.

Concept vehicles have two major roles for the Chrysler Group: they showcase to management, the media and the public the potential future design direction for Chrysler Group cars and trucks, and they help to attract the best young designers in the world into its design studios.

Chrysler Group’s concept vehicle program allows designers to test new colors, features, vehicle size and segments. Concepts can also be showcases for new design cues, which often find their way into production on future vehicles – even if the entire concept vehicle does not.

Importantly, the designs that are revealed to acclaim and accolade at auto shows around the world each year are not just built to look good. That is where the company’s design-to-reality tradition really kicks in.

Not only does Chrysler Group produce concept vehicles that can actually be driven – especially by journalists for feedback and publicity purposes – but many ultimately become production vehicles within a few years of their first reveal. The latest example is the Dodge Challenger. First revealed as a concept at the 2006 North American International Auto Show (NAIAS) in Detroit, it was announced that the Challenger will go into production in 2008.

According to Trevor Creed, Senior Vice President – Product Design Office, Chrysler Group, “We’ve always said at Chrysler that we don’t just produce concepts for fun. We have proved year after year that our concepts are innovative and relevant.

“Our track record shows that many Chrysler Group concepts, and several of the design features showcased on our concept vehicles, have gone into production,” he added. “While we can’t say yet if any of our 2007 concepts will eventually be seen in our showrooms, they clearly hint at exciting and innovative future design directions that could find their way into our company’s products.”

2007 Concept Vehicles

This year’s group of concept vehicles includes one for each of the Chrysler Group’s brands. Combining refinement, function and style, the Chrysler Nassau concept explores a new expression of the Chrysler brand. First shown at the 2007 NAIAS, the four-door, four-passenger Nassau luxury coupe is a more emotional and artistic articulation of what it means to be a Chrysler.

The Jeep® Trailhawk, which also had its premiere at the 2007 NAIAS, merges the spectrum of the Jeep brand by combining the core off-road features of the new Jeep Wrangler Unlimited with the refined sophistication of an all-new on-road, open-air concept vehicle, providing a unique and fresh expression for Jeep.

The Dodge Demon is a compact, nimble “roadster with an attitude” – a perfect balance of classic sports car proportion and simplicity blended with modern design and performance. The vehicle is designed to be an affordable Dodge sports car that merges brand cues of bold design and powerful performance with an open-air “fun-to-drive” attitude. This concept had its debut at the 2007 Geneva Motor Show.

Twenty Years of Modern Concept Vehicles

The Chrysler Group has a long history of innovation in design and engineering, going back even as far as the first 1924 Chrysler sedan. In the modern era, since 1988, the company has created more than 100 concept vehicles in a variety of shapes, sizes, configurations and materials.