China's President Jiang Zemin has said in a New Year message that 1997 was a very important and extraordinary year in Chinese history. Mr Jiang said China was extremely concerned about the recent financial turmoil in Asia, but noted that his own country's development had remained stable. Our Chinese affairs analyst James Miles says the year has indeed been a good one politically for Mr Jiang, but considerable social and economic problems will trouble his leadership in the year ahead.

In a speech broadcast on Chinese radio and television, China's President Jiang Zemin gave a generally upbeat assessment of his country's progress in 1997 and its prospects for the year ahead. It had been, he said, a very important and very extraordinary year in Chinese history.

Mr Jiang mentioned the death of the elder statesman Deng Xiaoping in February, what he called the smooth resumption of sovereignty over Hong Kong on July 1, and the convening of a five yearly communist party congress in September.

Many analysts believe these events have helped to strengthen the authority of Mr Jiang, who had no obvious power base when he was installed as party leader eight years ago.

The President also said 1997 had been a year of major diplomatic success, with a series of summits with world leaders including those of the United States, Russia, France and Japan.

But Mr Jiang hinted too at some of the problems the country faces. He said China was extremely concerned about the recent financial turmoil in Asia, although he refrained from describing the impact it might be having on his own country.

China's strict limits on foreign participation in its currency and stock markets have helped to shelter the country from the crisis. But Beijing acknowledges that its financial system suffers from many of the same flaws that have precipitated the chaos elsewhere.

Mr Jiang said the country faced what he called many difficulties in economic growth and social progress.

Again he didn't elaborate, but it's believed the leadership is worried that declining growth and soaring unemployment could trigger unrest. In recent months there've been increasing reports of isolated strikes and demonstrations by workers.