Encouraged by the strong economic performance recorded in 2002, the confidence index reflecting consumers' evaluation of the current economy and expectations for future economic development reached 97.7 points in January, the bureau said in a statement.

The confidence index rose further to 98.8 points in February - the highest since the beginning of 2002 - buoyed by Spring Festival spending and high expectations for the 10th National People's Congress and the 10th National Committee of the Chinese People's Political Consultative Conference.

But the confidence index dropped slightly to 97.6 points in March, weighed down by growing anxiety over the US-led war on Iraq, the bureau said.

About 78 percent of the consumers surveyed believed the external environment for China's economic development was unstable.

However, about 62 percent of the consumers expressed "satisfaction" on China's economic performance and more than 50 percent of those surveyed expressed confidence in the country's future economic development, the bureau said.

Qiu Xiaohua, deputy commissioner of the bureau, estimated last month that China could achieve a 7-per cent growth in its gross domestic product this year.

Fan Gang, director of the National Economic Research Institute, went further, predicting that economic growth may hit 8 percent this year.

China's economic situation was "quite good" in 2002, Fan said.

A series of figures including an 8-percent growth in its gross domestic product and a 16-percent growth in foreign trade last year indicates that the Chinese economy has entered a stable development period, he said.

The safe investment environment here has made the country a "haven" for international capital flow, Fan said.

''The country's manufacturing industry has been increasing its competitive edge, ... the country will have no inflationary pressure, and the deflationary pressure will ease,'' he said.

Researcher Zhang Liqun, a senior researcher with the Development Research Center under the State Council, said the upward trend in China's economic development will continue during the 10th Five-Year Plan period (2001-05), as market forces play a leading role in economic development.

(China Daily April 8, 2003)