Investments must be limited

The State Council believes China should limit fixed-asset investments because of overcapacity in industries such as aluminum, automobiles, coke and steel. The government should tighten its grip on land use and credit supply in an effort to control fixed-asset investment growth, the cabinet said. China’s fixed-asset investment grew by 26.6% in the first two months of this year to US$65.9 billion, while overall growth for 2005 was 27.2%. The total loans issued by financial institutions in China increased by 13.4% to US$2.66 trillion by the end of February, according to the Central Bank.