Heavy investment by the government this year will offset slowing growth in consumer demand and exports to ensure the mainland reaches its 8 per cent gross domestic product target for this year. Investment in fixed asset investment this year will grow by at least 15 per cent from last year's level to 300 billion yuan (about HK$279 billion), which, along with consumer demand rising by about 8 per cent to the same amount, will meet the 8 per cent target, chief economist of the State Statistical Bureau, Qiu Xiaohua, told a seminar. But economists are sceptical, saying that in the present buyers' market, with over capacity of most goods, companies do not want to invest in new capacity, while the Ministry of Finance has announced a lower budget deficit for this year, meaning there is less state money to spend. The figures for the first four months were not encouraging, with consumer sales growing by 6.9 per cent from a year earlier to 938.8 billion yuan and fixed asset investment by 12.2 per cent, while the revenues of state industrial firms fell 1.6 per cent to 335.9 billion and they posted a total post-tax loss of 11.2 billion, up 433.6 per cent. This means less income for the central government, which relies heavily on state companies for its tax revenue. In the first four months, industrial output rose a year-on-year 7.9 per cent. This needs to be at least 10 per cent if GDP is to grow by 8 per cent, economists say. Mr Qiu said he was confident of achieving the target, with higher government spending on farm, irrigation, high-technology, environmental protection, power and other infrastructure projects. He said investment demand would account for four to five percentage points of the 8 per cent and consumer demand three to four points. Exports, which accounted for two percentage points of the growth last year, will make a zero contribution this year, because of slower growth due to the Asian financial crisis. Mr Qiu said it was essential to attain the 8 per cent target to ensure sufficient budgetary income and rising personal living standards and make the mainland's contribution toward stabilising Asia's economy and jobs for the unemployed, with each percentage point in growth creating one million jobs. A spokesman for the People's Bank of China said there was plenty of money available in the economy but banks were reluctant to lend.