controls at
intervals. In late 1993 China's leadership approved additional
long-term reforms aimed at giving still more play to market-oriented
institutions and at strengthening the center's control over the
financial system; state enterprises would continue to dominate many
key industries in what was now termed "a socialist market economy".
In 1995-97 inflation dropped sharply, reflecting tighter monetary
policies and stronger measures to control food prices. At the same
time, the government struggled to (a) collect revenues due from
provinces, businesses, and individuals; (b) reduce corruption and
other economic crimes; and (c) keep afloat the large state-owned
enterprises, most of which had not participated in the vigorous
expansion of the economy and many of which had been losing the
ability to pay full wages and pensions. From 60 to 100 million
surplus rural workers are adrift between the villages and the
cities, many subsisting through part-time low-paying jobs. Popular
resistance, changes in central policy, and loss of authority by
rural cadres have weakened China's population control program, which
is essential to maintaining growth in living standards. Another
long-term threat to continued rapid economic growth is the
deterioration in the environment, notably air pollution, soil
erosion, and the steady fall of the water table especially in the
north. China continues to lose arable land because of erosion and
economic development. The next few years may witness increasing
tensions between a highly centralized political system and an
increasingly decentralized economic system. Economic growth probably
will slow to more moderate levels in 1999-2000.

GDP: purchasing power parity--$4.42 trillion (1998 est.)

GDP--real growth rate: 7.8% (1998 est.) (official figures may
substantially overstate growth)

GDP--per capita: purchasing power parity?$3,600 (1998 est.)

GDP--composition by sector:
agriculture: 19%
industry: 49%
services: 32% (1997 est.)

Population below poverty line: NA%

Household income or consumption by percentage share:
lowest 10%: 2.2%
highest 10%: 30.9% (1995)

Inflation rate (consumer prices): -0.8% (1998 est.)

Labor force: 696 million (1997 est.)

Labor force--by occupation: agriculture 50%, industry 24%,
services 26% (1997)

Unemployment rate: officially 3% in urban areas; probably 8%-10%;
substantial unemployme