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Business / Macro

Zhejiang performs well, but challenges lie ahead

By Li Jiabao (chinadaily.com.cn) Updated: 2013-01-23 14:13

Economic growth in Zhejiang province surpassed the national GDP growth rate last year, a report from the Zhejiang Academy of Social Sciences said on Monday.

Economic growth in the eastern province was 8 percent in 2012, while the country's growth rate was 7.8 percent

Fixed asset investment in the province surged 21.8 percent from January to November year-on-year, reaching 1.54 trillion yuan ($247.56 billion). The service sector received 966.7 billion yuan, up 25.1 percent from a year earlier. Private investment increased 23.2 percent year-on-year in the first 11 months and accounted for 62.9 percent of the province's fixed asset investment, the report said.

However, the shrinking demographic dividend and rising labor costs affected the competitiveness of exports reliant on cheap labor. In addition, the profit margin of enterprises generally declined while financing difficulties failed to show any fundamental improvement, the report said.

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