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 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
extortion 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. From 60 to 100 million surplus
rural workers are adrift between the villages and the cities, many
subsisting through part-time low-pay 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 the nation's long-term economic viability. One of the most
dangerous long-term threats 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. The amount of arable land continues to decline because of
erosion and economic development, the cumulative loss since the
Communist takeover in 1949 being more than 15%. The next few years
will witness increasing tensions between a highly centralized
political system and an increasingly decentralized economic system.

GDP: purchasing power parity - $3.5 trillion (1995 estimate as
extrapolated from World Bank estimate with use of official Chinese
growth figures for 1993-95; the result may overstate China's GDP by
as much as 25%)

GDP real growth rate: 10.3% (1995 est.)

GDP per capita: $2,900 (1995 est.)

GDP composition by sector:
agriculture: 19%
industry: 48%
services: 33% (1994 est.)

Inflation rate (consumer prices): 10.1% (December 1995 over
December 1994)

Labor force: 583.6 million (1991)
by occupation: agriculture and forestry 60%, industry and commerce
25%, construction and mining 5%, social services 5%, other 5% (1990
est.)

Unemployment rate: 5.2% in urban areas (1995 est.); substantial
underemployment

Budget:
revenues: $NA
expenditures: $NA, including capital expendi