In the first half of 2011, faced with the complicated and volatile international environment and the emerging challenges in domestic economic development, the Central Party Committee and the State Council firmly carried out the pro-active fiscal policy and prudent monetary policy, continuously strengthened and improved macro control. As a result, the national economy showed a good momentum of development, and kept moving towards the expected direction of macro control.

According to the preliminary estimation, the gross domestic product (GDP) of China was 20,445.9 billion yuan for the first half of this year, a year-on-year increase of 9.6 percent at comparable prices. Specifically, the growth of the first quarter was 9.7 percent, and 9.5 percent for the second quarter. The value added of the primary industries was 1,570.0 billion yuan, up by 3.2 percent; the secondary industries 10,217.8 billion yuan, up by 11.0 percent; and the tertiary industries 8,658.1 billion yuan, up by 9.2 percent. The gross domestic product of the second quarter of 2011 went up by 2.2 percent on a quarterly basis.

1. Agricultural Production Went on Steadily and the Summer Grain Production Achieved a Good Harvest. The total output of summer grain was 126.27 million tons, an increase of 3.12 million tons, up by 2.5 percent year-on-year. In the first half of this year, the total output of pork, beef, mutton and poultry reached 37.22 million tons, a year-on-year growth of 0.2 percent. The output of pork reached 24.43 million tons, down by 0.5 percent.

2. Industrial Production Realized a Steady Growth with Further Improved Economic Efficiency. In the first half of this year, the total value added of the industrial enterprises above designated size was up by 14.3 percent year-on-year. An analysis by types of ownership showed that the value added growth of the state-owned and state holding enterprises went up by 10.7 percent; collective enterprises by 9.6 percent; share-holding enterprises by 16.1 percent; and enterprises funded by foreign investors or investors from Hong Kong, Macao and Taiwan province by 11.1 percent. The year-on-year growth of the heavy industry was up by 14.7 percent, and the light industry by 13.1 percent. All the 39 industrial divisions registered year-on-year growth. The growth in eastern, central and western regions was up by 12.4 percent, 17.8 percent and 17.3 percent respectively. In the first half of this year, the sales ratio of industrial enterprises above designated size was 97.8 percent, or 0.1 percentage point higher than that in the same period of last year. In June, the total value added of the industrial enterprises above designated size was up by 15.1 percent year-on-year, or up by 1.48 percent month-on-month.

In the first five months of this year, the profits made by industrial enterprises above designated size stood at 1,920.3 billion yuan, up by 27.9 percent year-on-year. Among the 39 industrial divisions, 37 of them registered year-on-year increase in profits, and 2 divisions witnessed reduction. In the first five months of this year, the costs of primary activities of the industrial enterprises above designated size accounted for 84.7 percent of the turnover from their primary activities, which was 0.3 percentage point higher than that in the first quarter of 2011. In May, the profit rate of industrial enterprises above designated size from their primary activities was 6.2 percent.

3. Investment in Fixed Assets Kept a Fast Growth and Investment in Real Estate Sector Increased Rapidly. In the first half of this year, the investment in fixed assets (excluding rural households) was 12,456.7 billion yuan, a year-on-year growth of 25.6 percent. Specifically, the investment in the state-owned and state holding enterprises reached 4,305.0 billion yuan, a rise of 14.6 percent. The investment in the primary industries, the secondary industries and the tertiary industries went up by 20.6 percent, 27.1 percent and 24.7 percent respectively. In term of different areas, the growth in eastern, central and western regions was 22.6 percent, 31.0 percent and 29.2 percent respectively. In June, the investment in fixed assets (excluding rural households) went down by 1.04 percent month-on-month.

In the first half of 2011, the investment in real estate development was 2,625.0 billion yuan, a year-on-year growth of 32.9 percent. Specifically, the investment in residential buildings reached 1,864.1 billion yuan, up by 36.1 percent. The floor space of commercial buildings sold in the first half of 2011 reached 444.19 million square meters, a year-on-year growth of 12.9 percent. Specifically, the growth of residential buildings was up by 12.1 percent. In the first half of this year, the sources of funds for real estate development enterprises from the current year reached 4,099.1 billion yuan, up by 21.6 percent year-on-year. In June, the national real estate climate index was 101.75

4. Sales at Domestic Markets Enjoyed a Steady Growth and the Sales of Motor Vehicles and Real Estate Related Commodities Slowed Down to Some Extent. In the first half of this year, the total retail sales of consumer goods reached 8,583.3 billion yuan, a year-on-year rise of 16.8 percent. Specifically, the retail sales of the enterprises (units) above designated size stood at 3,903.4 billion yuan, up by 23.7 percent. Analyzed by different areas, the retail sales in urban areas reached 7,445.0 billion yuan, up by 16.9 percent, and the retail sales in rural areas stood at 1,138.3 billion yuan, up by 16.2 percent. Grouped by consumption patterns, the income of catering industry was 957.9 billion yuan, up by 16.2 percent; and retail sales of goods was 7,625.4 billion yuan, up by 16.9 percent. In particular, the retail sales of the enterprises (units) above designated size reached 3,610.8 billion yuan, a year-on-year growth of 24.2 percent. Specifically, the sales of motor vehicles rose by 15.0 percent, or 22.1 percentage points lower than that in the same period of last year; that of furniture grew up by 30.0 percent, or 8.5 percentage points lower; and that of household appliances and audio-video equipment went up by 21.5 percent, or 7.3 percentage points lower. In June, the total retail sales of consumer goods rose by 17.7 percent year-on-year, or 1.38 percent month-on-month.

5. Urban and Rural Residents' Income Increased Steadily with a Higher Growth for Rural Residents. In the first half of this year, the per capita total income of urban households was 12,076 yuan. Specifically, the per capita disposable income of urban population was 11,041 yuan, a year-on-year growth of 13.2 percent, or a real growth of 7.6 percent after deducting price factors. Of the per capita total income of urban households, the year-on-year growth of wage income was 11.5 percent; transferred income 9.9 percent; net income from business operation 31.2 percent; and 20.4 percent from property income. The per capita cash income of rural population was 3,706 yuan, up by 20.4 percent year-on-year, or 13.7 percent growth in real terms. Specifically, the rural growth of wage income was 20.1 percent; household operation income 21.0 percent; property income 7.5 percent; and 23.2 percent from transferred income.

The external and internal environment for China's economic development is still rather complicated with numerous instabilities and uncertainties. In the next phase, we should adhere firmly to the macro-control policies, maintain their continuity and stability, give first priority of work to the stabilization of overall price level and improve the relevance, flexibility and effectiveness of policies. We should also persist in balancing the relationship among a steady and comparatively rapid economic development, adjustment of economic structures and management of the inflation expectation; promote reform and innovation; and speed up adjustment of economic structures and transformation of economic development mode in order that we achieve a sound and fast growth.

Notes:

1. Approved by the State Council, the seasonally adjusted indicators of the following four will be released by the National Bureau of Statistics from April 2011: the quarterly gross domestic product (GDP), the month-on-month changes of value added of industrial enterprises above designated size, investment in fixed assets (excluding rural households), and total retails of consumer goods.

According to the auto-revision function of the seasonal adjustment model, GDP in the first quarter of 2011 and the month-on-month changes of the value added of industrial enterprises above designated size, investment in fixed assets (excluding rural households), and total retail sales of consumer goods from February to May have been revised. The revised figures and figures for June as well as GDP of the second quarter of 2011 are as follows:

The quarter-on-quarter growth of GDP in the first quarter of 2011 was 2.1 percent, and the second quarter 2.2 percent.

Month-on-Month Changes Value

	Value Added of Industrial Enterprises above Designated Size (%)	Investment in Fixed? Assets (%)	Total Retail Sales of Consumer Goods (%)
February	1.04	1.56	1.31
March	1.25	0.75	1.40
April	1.06	2.41	1.33
May	1.10	0.17	1.35
June	1.48	-1.04	1.38

2. Approved by the State Council, the National Bureau of Statistics raised the cut-off size of industrial and fixed assets investment statistics from January 2011. The cut-off size of industrial enterprises changed from an annual revenue from primary activities above 5 million yuan to 20 million yuan; and the cut-off size of fixed assets investment projects rose from a total planned investment above 500 thousand yuan to 5 million yuan. According to estimation, with the new coverage, the data collected on the total volume, structure and growth rates of industrial enterprises and investment in fixed assets showed a similar trend as compared with those under the former coverage.

3. From 2011, the National Bureau of Statistics improved the monthly statistical system of fixed assets investment, expanding the coverage of the monthly statistics from urban areas to rural enterprises and institutions, and defined it as the investment in fixed assets (excluding rural households). This makes the monthly data more complete and the definition more accurate.

4. From 2011, data on the retail sales of the enterprises (units) above designated size are released. The retail sales of the enterprises (units) above designated size refer to the wholesale enterprises (units) with the revenue from primary activities above 20 million yuan, the retail enterprises (units) with the revenue from primary activities above 5 million yuan, and the lodging and catering enterprises (units) with the revenue from primary activities above 2 million yuan.

5. The growth rate of gross domestic product, value added of industrial enterprises above designated size and its sub-items are real growth by using comparable prices. The growth rates of other indicators are nominal growth by using current prices unless otherwise specified.

In case of any difference between English translation and the original Chinese text, the Chinese edition shall prevail