A hot debate on whether China’s economy is turning cold is underway around the country’s economic circle since this spring. At the second China economic observation forum, some economists predict that China’s economy may fall into a deflation characterized by persistent consumer price decrease.
Lin Yifu, Director of China Center for Economic Research (CCER)of Beijing University, said at the forum held quarterly by CCER that owing to the overproduction in most manufacturing sectors since 1998 and the to-be-overcapacity from over-investment in some sectors in 2003 and 2004, China is expected to see deflation caused by overcapacity in the latter half of 2005.
Wang Jian, Deputy Secretary General for the Economic Research Institute under State Development and Reform Commission, said thatdecreasing growth of Consumer Price Index (CPI), dropping enterprise profits, as well as losses in downstream industries areall signals that China’s economy has taken a cooling trend.
CDT EBOOKS
Subscribe to CDT
SUPPORT CDT
Giving Assistant
Anti-censorship Tools
Click on the image to download Firefly for circumvention
