Domestic business managers are expressing more confidence in China's economic future than they have been since 1995, a nationwide survey of executives suggests.

They also said Shanghai is the best place to do business on China's mainland.

The survey, which was conducted by a research unit of the State Council's Development Research Center, was sent out to 10,000 executives across the country. The results are based on 3,192 valid responses.

Nearly 60 percent of the executives said they will invest more than they originally planned to expand their businesses in the near future, while more than 40 percent said they plan to upgrade technology to weather the intensified competition created by China's entry to the WTO

The survey also suggests that managers think the country's economic growth is faster than expected. Over 30 percent of respondents said growth was "hot," or expanding faster than normal. That number is nearly 20 percentage points higher than last year's.

About 50 percent said the economy is growing at a "normal" rate, while 10.5 percent said growth was "cold," the lowest proportion to make that claim since 1995.

"These answers imply Chinese managers clearly feel China's economy is on the fast track," the research body said in a statement.

It announced the results of its 11th such annual survey in Beijing on Saturday.

Among the respondents, 54 percent are from eastern China, 23.1 percent work in central China, while the rest are from the west. About 30 percent of the managers run state-owned companies, with the rest managing both domestic and overseas-funded firms.

A majority of those surveyed said they are looking at increasing their investment plans due to China's strong growth. Over 59 percent said they will increase spending, while 26.2 percent said they won't change their plans at this point.

Only 14.6 percent said they are considering cutting investment.

China's entry into the WTO a year ago has resulted in intensified competition in domestic markets, 75 percent of the managers said. To weather the challenge, 42.9 percent of them said they will upgrade technology, while 25 percent said they will expand production capacity.

Insufficient domestic demand remains a bottleneck for economic development according to those surveyed, but the situation is improving. About 46 percent of managers reported there is not enough demand for their products or services - nearly 15 percentage points lower than last year's result.

Though many said China is already the world's factory, only 11 percent of managers said they are making products for overseas markets. Among managers of overseas-funded companies, however, that number jumped to 35.1 percent, providing fresh evidence that foreign companies are playing a major role in the country's development.

When asked which mainland city has the best infrastructure, government services and market order, the majority of respondents voted for Shanghai in all three categories.

(Eastday,com November 17 2003)