Oil price impact on China's economy 'limited'
Updated: 2005-10-20 13:22
Surging oil price will only have limited impact on China's economy, Zheng
Jingping, spokesman for the National Bureau of Statistics (NBS), said in Beijing
"The oil price increase surely will have impact on China's economy as 40
percent of oil consumed in the country is imported," said Zheng at a press
conference, "especially on some sectors, like agricultural means of production,
oil refinery and public transport. But the impact is limited."
spokesman for the National Bureau of Statistics, speaks at a press
conference on China's economy in Beijing October 20, 2005.
According to International Monetary Fund, the world oil price will rise by 40
percent over last year's level. The high price has caused impact on world
Zheng said that China's total oil consumption is not high, accounting for
eight percent of world total.
Besides, China has a lot of supplanting energy sources, like coal and natural
China's utilization and development of natural gas has great potential, said
Zheng, adding that currently, China's natural gas/crude oil consumption
proportion stands at 0.24:1, compared with 1:1 in some foreign countries.
Coal consumption accounts for 75 percent of total energy consumption in
China. The technology of coal converting to oil has been put into manufacturing
process, said Zheng.
Zheng noted that though the impact is limited, China should be cautious and
take measures to minimize the impact.
Zheng criticized the speculation on world oil market, saying that current
high oil price is abnormal.
"The current oil price couldn't represents the relations between supply and
demand," said Zheng." speculation has played a more important role in the
increase of oil prices."
He noted that speculation of oil price has caused great attention from all
over the world. If the speculation continues, it will do harm not only to
China's economy, but also to the world economy. The speculators will also be
affected when the bubbles break, said Zheng.