China's non-state-owned industry continued steady growth during the second quarter of this year, according to the State Economic Restructuring Office.

During the last three months since April, the output of non-state-owned industry saw a year-on-year increase of 11.6, 11.9 and 12.1 percent each month respectively, the latest research by the restructuring office found.

The average rate of increase has kept abreast with the overall development of China's industry.

The State Economic and Trade Commission said last week that China achieved faster year-on-year development in industrial production in the first half of this year than last year. Total added value reached 1.446 trillion yuan (US$174.2 billion), and output increased 11.7 percent compared with the same period last year.

Xia Xiaolin, a member of the research group of the economic restructuring office under the State Council, attributed the rise to a favorable international economic situation and encouraging policies implemented by the central government.

Xia said the central government has noticed the importance of private enterprises in the re-employment of workers laid off by state-owned enterprises.

Chinese Premier Zhu Rongji pointed out in his government work report earlier this year that China should encourage and support the healthy development of the private economy.

Following Zhu's report, the State Development Planning Commission made public a package of measures to continuously invigorate the private sector.

At present, China's private economy has developed from a minor player into one of the major components of the socialist market economy.

The private sector's share of China's gross domestic product (GDP) is estimated to have reached 33 percent, a little lower than the 37 percent share of the state-owned economy. The other 30 percent comes from agriculture, the collective economy and the foreign-invested sector.

The development of the Chinese private economy started in the early 1980s, and it grew at an annual rate of 20 percent, much faster than the 9.5 percent growth rate of the national economy over the past two decades.

The private economy in China's Shanghai and Guangdong and Zhejiang provinces has contributed the lion's share to the economy.

Last October, Beijing cancelled the regulations limiting the development of private enterprises, and gave them equal treatment with state-owned and collective enterprises in terms of market access, land use, bank loans, taxation, and import and export.

However, difficulties in getting bank loans have hindered the development of private enterprises.

He Xiaoming, a researcher at the State Economic Restructuring Office, said that controls should be loosened to help small and medium-sized enterprises and private firms get bank credit more easily.

(China Daily July 29, 2002)