China's labor force is undergoing a historic shift from farms to factories and service trades with the number of farmers dropping 20 percent from 1979 to 2001.

Figures released by the National Bureau of Statistics (NBS) Monday show that those working in primary industries accounted for 50.1 percent of total labor force at the end of 2001, in comparison with 70.5 percent in 1978.

In the meantime, the number of people working in tertiary trades increased by 140 million, with the proportion growing from 12.2 percent in 1978 to 27.7 percent in 2001.

As the economy expanded rapidly over the past two decades, primary industries accounted for increasingly smaller shares of the gross domestic product (GDP). However, the economic efficiency of the primary industries surged 11 percent over the period.

According to the NBS, China has completed the rationalization of its industrial structure by overcoming such problems as weak agricultural infrastructure, crippled industrial layout and underdeveloped services. China has entered a new stage of upgrading and advancing its industrial structure.

The NBS predicts that private industries will boom in coming years as the government allows wider market access and better financial services. Private capital generates a quarter of the country's GDP and has entered sectors which were previously government monopolies, including transport and telecommunications.

The expansion of private ownership will help China develop new growth areas in its service industries, which, according to NBS figures, is lagging behind developed countries and most developing countries in terms of infrastructure, new businesses and share in GDP.

The NBS predicts that consumption will make up a greater part of China's GDP in coming years. Expenditure on consumption accounted for 60.6 percent of GDP in 2001, around 19 percentage points lower than international average. On the other hand, investment accounted for 37.3 percent of GDP, far greater than the ratio in other countries.

A higher ratio of investment in GDP is natural for a developing economy like China's. However, it will be a long-term trend that the GDP proportion of investment will drop and that of consumption will rise, according to the NBS.

Over 93.5 percent of the industrial structure in eastern, central and western parts of China are identical. The problem of repetition is even more serious within different specific provinces in these areas. The NBS says China should focus on solving this problem through further economic restructuring.

It also points out that the gap in economic development among different areas of China has been widening over the past 23 years. The Chinese government has launched a strategic campaign to develop western areas so as to reverse the trend.

(Xinhua News Agency October 8, 2002)