China's stock market has declined continuously recently, arousing
nationwide attention.
But Chinese economists have pointed out that the slide of the
market will not affect the national economy, instead, it will
continue to maintain stable growth.
"
The stock index soared to over 2,300 points earlier this year, and
it has recently fallen markedly, which are normal periodical
vibrations," said Chen Hui, deputy director of the Market Institute
of the Development and Research Center of the State Council.
The new regulations, in force since June 13, aimed at reducing the
ratio of state-owned shares, will not affect the supply and demand
in the market, Chen added, and it does not have any necessary
connection with the fluctuation.
Many economists hold that the slump of state-owned shares will thus
distribute more profits to society, as other stockholders can earn
profits when purchasing new stocks. The rise and fall of stock
prices will not harm the overall social benefit, they say.
Chen said that people purchase shares in expectation of future
profits, and this in turn might cause in a sense some bubbles in
China's stock market. The economic stagnation in the U.S. and
Japan, as well as the downturn of the international stock market
will not have a long-term impact on the Chinese stock market,
thanks to the government' s policy of stimulating domestic
demand.
Experts hold that many factors contribute to the strong momentum of
economic development --such as the country's stable currency, the
eight-percent economic growth rate last year, and the increase of
export volume, commodity sales and direct foreign investment in the
first half of the year.
In
the past decade, the reforms carried out in the financial sector
have helped most Chinese state-owned enterprises get out of the
black. Moreover, the social security system will ensure the basic
living standards for laid-off people, thus paving the way for the
ongoing reform.
Meanwhile, the streamlining of government organizations is also
improving their work efficiency. The anti-monopoly campaign,
particularly the movement to promote more competition in the
aviation and telecommunications industrial sectors is a powerhouse
for further economic growth.
China's imminent entry into the World Trade Organization and the
government's large-scale investment in the 2008 Olympic Games in
Beijing will keep pushing domestic demand and economic
development.
Chen Huai noted that all the facts list above combine to form an
unmatched economic accelerator in Asia, and even in the world.
( 08/06/2001)