. the oil price has been unexpectedly high, although recently it has fallen slightly. moreover, industrial activity appears to have weakened slightly, both in sweden and abroad. we therefore came to the conclusion in april that growth in sweden would be somewhat weaker than was anticipated in the march inflation report. since then, we have seen statistics showing that growth in germany was slightly stronger than expected during q1, and that the downturn noted in the united states in march appears to have been temporary. we had anticipated lower growth in sweden ’ s net exports, but exports of goods appear to be increasing even less than was forecast. however, good growth in real incomes and low interest rates will contribute to favourable growth in household consumption. the labour market remains relatively weak, and our forecast is based on employment strengthening during 2005. at the same time, we can see rising price pressures in some industrial nations, particularly the united states, which are partly – but not solely – a consequence of the high oil prices gaining greater impact in the production and consumer segments. it is important to monitor whether the slackening tendencies seen in economic activity recently are temporary or more persistent. if we were to see a notably poorer development than we envisage now, such as much lower growth than forecast, the arguments in favour of cutting interest rates would in my opinion take on greater substance. we will be considering all of these factors at our next monetary policy meeting on 20 june. thank you!

a rate and in a scope that few people considered possible a few decades ago. since the reform policy began at the end of the 1970s, average growth has been 9 per cent a year. china has accounted for one third of the world ’ s real growth in recent years. the country has rapidly transformed into the second largest economy in the world, become the third largest trading nation and one of the largest recipients of foreign direct investment. 3 the strong growth in china has been driven by investment and exports. investment comprises just over half of gdp, which is much higher than the shares in oecd countries or in other rapidly - growing economies. the high level of investment has been almost entirely financed through domestic savings. the saving ratio in china amounts to around 45 per cent of gdp, which is a much higher level than in most other countries. according to estimates, chinese households save one third of their incomes. one reason for the high level of saving is the lack of a social safety net and a general pension system. as a consequence of the high level of saving, private consumption is relatively low. china has had relatively strong growth in exports ; in the past five years alone exports have trebled. 4 the country is currently a nation as open as, for instance, france and italy, measured in the percentage of foreign trade in gdp and considerably more " open " than the united states. china has come to be called “ the factory of the world ” as an increasing number of foreign companies have chosen to purchase goods and locate parts of their production there. for instance, china manufactures more than two thirds of all photocopiers, microwave ovens and dvd players, and 40 per cent of all of the world ’ s computers. 5 however, a large part of the input goods for these products are imported from neighbouring countries, but the prevalent picture that china can only compete with lowcost products is slowly changing. in recent years china has gone from specialisation in simple, labourintensive low - cost products to also producing more technically - advanced and internationallycompetitive products. the chinese authorities conduct an active trade and industry policy to build up the domestic industrial and technological capacity, for instance in the fields of telecommunications, energy, motor vehicles and pharmaceuticals. their goal is to have 30 - 50 chinese countries among the world's 500 largest within 5 - 10 years. in addition to investments in research and development, china ’ s human capital has also been reinforced by an increasing return flow of highly