An encouraging sign

Updated: 2007-01-26 06:56

The fastest economic growth in a decade surely makes 2006 a good start in achieving China's 11th Five-Year (2006-10) development goal. But last year should be better remembered for a change of far-reaching significance that happened in the country's efforts to save energy.

It is impressive that the Chinese economy, the world's fourth largest, has now grown at double-digit rates for four years in a row. It is even more surprising that China's gross domestic product (GDP) grew 10.7 percent to 20.9 trillion yuan ($2.7 trillion) last year, the fastest rate since 1995.

This growth occurred in spite of a spate of tightening measures to keep the pace of expansion in check.

Rapid GDP growth, high industrial profits and low inflation together point to rosy prospects for the Chinese economy.

However, the more decisive progress that the country made last year has come in a much less spectacular way.

Though policymakers admitted the 2006 failure in fulfilling the goal to cut energy consumption by 4 percent per unit of GDP output, the country finally managed to reverse the trend. Since the third quarter of last year, the country's energy consumption per unit of GDP output dropped for the first time in three years.

This is a very encouraging signal that the energy saving measures the authorities have implemented are beginning to work.

With more fiscal, tax and price incentives to be put in place, it is reasonable to expect that the country will make bigger strides in saving energy.

China has maintained robust economic expansion for about three decades and is now positioned to pursue sound and speedy growth in coming years.

Rapid economic growth has long been associated with a decline in energy efficiency. But 2006 witnessed both an acceleration in economic growth and a reduction in energy consumption per unit of GDP output.

This is living proof that improved energy efficiency does not have to come at the cost of economic growth.

This makes it high time to further step up our energy-saving efforts.

(China Daily 01/26/2007 page10)