China's Top 10 Economic News Stories for 2005

The editor-in-chief of China Daily, along with peers of 16 Beijing-based media organizations and nine economists, select China's top 10 economic news stories for 2005.

A series of macro-control measures on over-heating real estate market

The Standing Committee of the State Council on April 27 put forward eight tough measures on macro-control of property markets. In two weeks, seven ministries, including the Ministry of Construction, issued proposals for stabilizing housing prices. On June 1, the government unveiled further policies to collect a tax of 5 per cent on the full earnings of all home sales if the property is sold within two years of being purchased. Soaring house prices have shown signs of slowing down.

Non-tradable share reform

On April 29, the China Securities Regulatory Commission issued a document to begin trials on floating non-tradable shares. Currently more than 300 domestic-listed companies are involved in the reform.

Bird flu found in 11 provinces

The first case of bird flu was found in Qinghai in May. By December 14, 30 cases of the fatal H5N1 strain of the virus was reported in 11 provinces and five people were infected. But the control of bird flu has seen initial success and 23 affected areas have been able to ease their restrictions on preventing the spread.

A more flexible mechanism for RMB exchange rate

The People's Bank of China announced on July 21 to reform the exchange rate regime by moving into a managed floating exchange rate regime based on market supply and demand with reference to a basket of currencies, instead of the US dollar alone. The RMB exchange rate regime will be improved with greater flexibility.

Clearing "official shares" in coalmines

In late August, the Ministry of Supervision, the Central Commission for Discipline Inspection of the Communist Party of China, the State-owned Assets Supervision and Administration of the State Council, and the State Administration of Work Safety ordered government officials and State-owned enterprises leaders to withdraw their shares in the coalmine industry before September 22, or be removed their posts.

The 11th Five-Year draft programme approved by CPC

The fifth plenary session of the Central Committee of the Communist Party of China (CPC) held between October 8 and 11 approved a proposal for formulating the 11th Five-Year Programme for national economic and social development in China. The proposal aims to double the per capita gross domestic product for the year 2000 by 2010 and will cut the per unit GDP energy consumption by about 20 per cent by the end of 2010.

A peaceful solution to textile disputes

China and United States signed a Memorandum of Understanding on November 8 in London to find a solution to the bilateral textile tensions after seven rounds of talks in five months. On June 11, China and the European Union also managed to reach a way to tackle the textile problems.

Water pollution in Songhua River

On November 13, a plant explosion of PetroChina's Jilin branch led to a leakage of poisonous substances into the Songhua River. The central government took emergency measures to minimize the impact of the water pollution.

GDP substantially revised after economic census

The National Bureau of Statistics revised the size of the economy on December 20, saying GDP was 16.8 per cent higher in 2004 than previously reported mainly because the service sector was not fully taken into account before. The country raised the GDP in 2004 to 15.99 trillion yuan (US$1.93 trillion) from 13.65 trillion (US$1.64 trillion).

Agricultural tax abolished and personal income tax threshold raised

The National People's Congress on December 29 approved a motion on abolishing the regulations on the farm tax, which means the 2,600-year-old agricultural tax will be cancelled from January 1, 2006. A revised Personal Income Tax Law will also be effective on the same day, which raises the threshold for monthly personal income tax from 800 yuan (US$99) to 1,600 yuan (US$198).