Thanks to its arduous efforts, the government succeeded in maintaining an economic growth of eight percent, keeping the currency stable, bailing out loss-making large and medium-sized state-owned enterprises as scheduled and achieving satisfactory results in the reform of grain circulation, investment and financing system, housing, medicare and taxation.

Attaining an eight percent growth and keeping the currency stable in 1998 was the first task the government set to itself after it took office. "In 1998, the rare floods that caused a direct economic loss of 200 billion yuan (US$24 billion) and the adverse impact of the Asian financial crisis put the government to acid tests," said Qiu Xiaohua from the National Bureau of Statistics. "The government managed to achieve a growth of 7.8 percent, just 0.2 percent short of the target."

The success in bailing out loss-making state-owned enterprises made it possible to proceed with the establishment of a modern corporate system, said Li Shousheng from the State Economic and Trade Commission.

In order to ease the difficulties of state-owned banks overburdened with a very high rate of bad assets, the government set up four asset management companies. The four companies disposed of 300 billion yuan (US$36 billion) of bad assets and recovered 100 billion yuan (US$12 billion) by the end of 2002.

The government has also tried to streamline the operations of government agencies by reducing the number of government departments from 40 to 29 and cutting the size of staff by half, thus shaping up a framework for building a diligent, clean and efficient government.

(Xinhua News Agency March 5, 2003)