2002 Third Quarter China Monetary Policy Implementation Report

Author: Monetary Policy Analysis Team of the People's Bank of China
Publisher:
Publish Date: 2002-11-01
Features: Since 2002, China's national economy has continued to grow rapidly. The GDP growth rate for the first three quarters was 7.9%. The decline in price levels has slowed down. From January to September, the year-on-year decline in the Consumer Price Index (CPI) was 0.8%. Consumer demand remained stable, while investment grew rapidly. Import and export trade and foreign capital utilization exceeded expectations. The primary, secondary, and tertiary industries grew simultaneously, and industrial and agricultural production operations were normal. While maintaining moderate growth in the total volume of monetary and credit, the People's Bank of China held two consecutive meetings of the heads of state-owned commercial banks in June and July 2002 to study the establishment and improvement of loan marketing mechanisms, strengthen and enhance financial support for small and medium-sized enterprises, and issued the "Opinions on Further Strengthening Financial Services for Small and Medium-sized Enterprises with Market Potential, Efficiency, and Creditworthiness." Commercial banks held meetings of branch heads to actively implement various measures, and the loan volume to the non-state-owned economy grew steadily. 2002 was the year after China's entry into the World Trade Organization. The Chinese automotive industry achieved a development speed beyond expectations. In addition to factors such as price, demand, and policy, consumer credit also greatly supported the development of the automotive industry. By the end of September 2002, the outstanding balance of auto loans had reached 93.6 billion yuan. The real estate industry developed rapidly, but the potential risks of rising real estate prices and increasing vacant areas should be noted. While supporting the development of the real estate industry, commercial banks must strengthen credit management and remain vigilant against the emergence of a real estate bubble.