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The Asian Development Bank (ADB) asserted yesterday that the Chinese Government's macro-control measures will not have a negative impact on the bank's business in the nation.
Tang Min, deputy country director of the bank's resident mission in China, said investment backed by a majority of the bank's loans was in sectors such as infrastructure, agriculture and rural development.
These are areas that the government is encouraging investment in, he pointed out.
Meanwhile, investment backed by the bank's loans, between US$1.2 billion and US$1.5 billion annually, accounted for less than 0.2 per cent of the country's total fixed asset investment.
Last year, the bank's lending to China totalled US$1.3 billion.
The loans were used on seven projects including the second phase of Hunan Province's road development, road development in Gansu Province and environmental improvement in Liaoning Province.
The bank also provided US$16.08 million in technical assistance to more than 20 projects in China last year.
Toru Shibuichi, country director of the bank's resident mission in China, said the figures indicate that China is the largest borrower and the ADB's most important client.
The bank plans to lend US$1.5 billion for six projects in China this year, Shibuichi said.
It also plans to provide US$12 million in technical assistance to 25 projects in the country, he said.
The bank's planned annual lending of US$1.5 billion in China between 2005 and 2007 will focus on projects in the less-developed central and western regions.
More than 80 per cent of the lending will be earmarked for projects in those poorer regions.
The benefits of growth must be inclusive and improve the lives of most people, particularly the poor, the bank said.
According to Tang, overheating remains a concern for China's economic development this year.
"Last year's economic growth of 9.5 per cent left us a little bit surprised," he said.
It was still a faster rate compared with the 9 per cent predicted by the ADB, he said.
Fixed asset investment also grew at a higher rate of 25.8 per cent last year, although it slowed significantly from 43 per cent in the first quarter.
Tang admitted the country's macro-economic control measures have had an impact.
"If there were no macro-controls, the growth rate in both the gross domestic product and fixed asset investment would be higher," he said.
The government said it would continue to strengthen and improve its macro-controls this year.
The measures taken last year will also continue to have an impact on the economy, Tang said.
The Chinese economy is likely to grow 8.5 per cent this year, he said.
While strengthening macro-control measures, the government should endeavour to increase farmers' income. The government should also concentrate on speeding up financial reform, as the country's opening accelerates.
Meanwhile, it should take measures to maintain healthy international trade.
(China Daily February 4, 2005)
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