Fixed asset investment rises 24.1 percent

　　CHINA’S fixed asset investment, a general indicator of State spending aimed at boosting economic growth, rose 24.1 percent in the first seven months of this year from the same period a year earlier, the State Statistical Bureau said Friday.The bureau did not give a figure for July alone, but fixed asset investment grew 21.5 percent in the first half of the year. Fixed asset investment mainly covers spending by State firms on equipment and construction and is used by the government as an indicator of how it is progressing towards its target of 7 percent economic growth this year. Spending on general infrastructure rose 23.6 percent while that on upgrades and renovation rose 15.8 percent. Real estate saw the fastest growth at 30.7 percent. Investment in so-called primary industries, which largely comprise the farm sector, rose by 26.6 percent but accounted for just 46 billion yuan (US$5.8 billion).In secondary industries, mainly industrial and construction firms, investment rose 26 percent to 434.8 billion yuan. Services such as restaurants and banks, covered under the label of tertiary industries, took 898.5 billion yuan in investment, a 23.2 percent increase over a year earlier. China’s economy is on track to beat the government target, posting growth of 7.8 percent in the first half. The economy has been helped not only by State spending, but also by heady export growth and soaring foreign investment. Analysts say the government is likely to persist with its spending programs for this year, but could re-evaluate the size of future stimulus packages if exports and investment slow.

　　Some analysts said there were signs fixed asset investment could be easing slightly from the levels seen in the first half as rising exports trim the need for State spending and highway, hydropower and airport projects are completed.

　　“They may cut back on some of the spending on infrastructure projects once they see they can achieve 7 percent or 7.5 percent economic growth for the year,” said Pu Yonghao, an economist with Nomura International in Hong Kong. (SD-Agencies)