During its 10th Five-Year Plan Period (2001-2005), China had been dealing with the complicated world situation and domestic economic and social issues. It proves that China has stood the test of difficult situations and achieved its goal of fast economic development while still facing great challenges ahead.

The first year of the new century was full of turbulences. Hit by the economic recession in countries like the United States and Japan, the world economy had been slow down, the international financial markets in fluctuation, stock markets sluggish and exchange markets unstable. A United Nations report issued that year said the world economy had plunged into the lowest point in the previous decade or so.

While peace and development remain the theme of this era, the world is far from peaceful.

From the 9/11 incident in 2001 to the Iraq war in 2003, regional wars and local conflicts never stopped. Plus, tsunami, oil price hike, ever-falling US dollar exchange rate -- whether natural or man-made -- made it even worse for the already weak world economy.

Despite a revival started from 2003, uncertainties propped up in succession. It seems "recession" had made itself a keyword for the world economy in the past five years.

With the trend of globalization, the depressed world economy inevitably had an impact on China.

At the early stage of the 10th Five-Year Plan Period, due to decreased global orders, China saw a substantial decrease of its exports, which in turn led to slowed industrial growth. In the meantime, domestic demand also remained incompetent in growth, accompanied by serious conflicts in economic structure, difficulties in raising farmers' income as well as heavier pressure over employment.

As early as in 1998, the Central Committee of the Communist Party of China (CPC) and the State Council, striving to turn the situation, took a proactive fiscal policy and a prudent monetary policy, driving Chinese economy out of the harsh tides of Asian financial crisis.

Till 2003, Chinese economy ended a five-year anti-deflation, entering into another period of fast growth. Unfortunately, sudden outbreak of SARS (Severe Acute Respiratory Syndrome) and the flooding disasters that year defined 2003 a special year in the history of China's economic development.

People might still remember, at the peak of the SARS epidemic, shopping centers, restaurants, airports and harbors were all in a slump. Market sales fell sharply, tourism was blown hard, transportation saw an obvious downturn, and so did export orders and sales of farm products.

SARS outbreak had an untold impact on China's economy -- GDP growth rate fell to 6.7 percent in the second quarter of 2003 from 9.9 percent in the first quarter.

Remaining sober-minded in crisis, the Party Central Committee and the State Council made efforts to, on the one hand, get the SARS epidemic under control, while on the other hand, to awake the economy.

With effective measures, plus the joint efforts of the Chinese people, the epidemic was eventually brought under control without incurring more economic losses.

In 2003, China's economy further sped up on the basis of the fast growth in the previous year, securing a GDP growth by 9.1 percent. The overall economy was also the best since the Asian financial crisis in 1997.

It was also in that year that blind investment was seen in some sectors including iron and steel, electrolytic aluminum and cement, plus low-level expansion. In 2005, there emerged problems such as swollen real estate sector and unduly speedy hikes of housing prices in some cities. By the year-end of 2005, bird flu lingering in Southeast Asia started to break out in some areas in China, a sign of another test for China's high-rate economic development.

Overall, at the beginning of the tenth five-year plan period, China faced low export, flagging investment, weak spending and deflation. As time passed, during the mid-term and afterwards, it confronted with plain over-heated investment in some sectors, looming inflation and shortages of coal, electricity, petroleum and transportation. It seems history was creating on purpose another complex situation for China in its tenth five-year plan period.

By People's Daily Online