The composite index measuring industrial enterprises' economic efficiency reached 115.7 points for the period, an increase of 16.8 points over the same period of last year.

The improved industrial performance was partly due to increases in production and sales, said Xu Jianyi, deputy director of the bureau's Industrial and Transportation Statistics Department.

The total industrial output for the first 11 months rose 11.5 percent year-on-year to 2.1 trillion yuan (US$256.9 billion). Sales income amounted to 7.3 trillion yuan (US$881.1 billion), up 21.3 percent from a year ago.

"The increased exports as a result of the recovery of the world economy also contributed to the improvement,'' he said, adding that the country's exports increased by 26.1 percent for the first 11 months, compared with exports for the same period last year.

The higher tax rebate rates for exported products this year could also explain the improved efficiency, Xu said.

In order to encourage exports, China has raised its tax rebates three times since 1998, he said.

The country's exporters now enjoy an average tax rebate rate of 15 percent when selling products to other countries.

Statistics from the State Administration of Taxation indicate that China paid out 71 billion yuan (US$8.6 billion) in tax rebates to exporters during the first nine months of this year.

The figure represents a 94.6 percent increase over rebates in the same period of last year.

Both domestic and international markets have seen price rises for some industrial products, including oil and nonferrous metals, since the second half of last year, Xu said. "This is another reason which could explain why the industrial enterprises' economic efficiency improved so considerably.''

The interest rate cuts and debt-to-equity swaps, as well as the restructuring of China's state-owned enterprises, have also brought benefits to businesses, he said.

According to the statistics bureau, industrial enterprises' net profits amounted to 371.4 billion yuan (US$44.7 billion) during the first 11 months, an increase of 92 percent over those from a year ago. The figure included net profits of 208.3 billion yuan (US$25.1 billion) made by state-owned and state-controlled firms, which represents an increase of 140 percent year-on-year.

Total losses stood at 100.6 billion yuan (US$12.1 billion) for the period, a drop of 16.3 percent compared to those from a year ago. The losses by state-owned firms and firms in which the country holds a majority of the stake totalled 62.9 billion yuan (US$7.6 billion), down 18.2 percent from those in the previous year.

(China Daily 12/28/2000)