China growth to slow in '08: World Bank
China's economic growth will slow to an estimated 9.4 percent in 2008 from 11.4 percent last year, ending five straight years of double-digit expansion, the World Bank said on Tuesday.
By Agencies |
SINGAPORE: China's economic growth will slow to an estimated 9.4 percent in 2008 from 11.4 percent last year, ending five straight years of double-digit expansion, the World Bank said on Tuesday.
Growth next year is projected to ease still further, to 9.2 percent, with the slack partially offset by robust domestic demand, the Washington-based institution said in a half-yearly report on the East Asia region.
The slower growth, a result of weaker exports, will likely be welcomed by Beijing policymakers who have struggled to cool the economy despite a raft of measures aimed at averting overheating, the bank said.
"While the uncertain global outlook may slow China's exports, the country's growth is expected to remain robust, and the authorities are well positioned to stimulate demand if needed," it said.
"This growth rate reflects not only the ability of Chinese exporters to seek alternative export markets but also the growing role of domestic demand."
The Chinese economy held up in 2007, posting its fifth straight year of double-digit expansion despite slowing exports, especially to the United States, the report said.
However, inflation rose last year and showed no signs of easing this year because of higher food prices, which were made more pronounced due to tight pork supplies, it said.
"With households spending on average more than one-third of their incomes on food, the food price hikes have affected purchasing power, particularly of the urban poor and some rural groups, although higher food prices benefit net food producers in rural areas," it said.
"In addition, international prices of energy, industrial materials and agricultural products continue to rise and will gradually exert their influence on domestic prices."
Premier Wen Jiabao and other officials have repeatedly called for the stabilisation of food prices, voicing worries that rising costs of food could lead to social unrest.
The Chinese government has targeted eight percent economic growth for this year while aiming to maintain inflation at 4.8 percent.
Growth next year is projected to ease still further, to 9.2 percent, with the slack partially offset by robust domestic demand, the Washington-based institution said in a half-yearly report on the East Asia region.
The slower growth, a result of weaker exports, will likely be welcomed by Beijing policymakers who have struggled to cool the economy despite a raft of measures aimed at averting overheating, the bank said.
"While the uncertain global outlook may slow China's exports, the country's growth is expected to remain robust, and the authorities are well positioned to stimulate demand if needed," it said.
"This growth rate reflects not only the ability of Chinese exporters to seek alternative export markets but also the growing role of domestic demand."
The Chinese economy held up in 2007, posting its fifth straight year of double-digit expansion despite slowing exports, especially to the United States, the report said.
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However, inflation rose last year and showed no signs of easing this year because of higher food prices, which were made more pronounced due to tight pork supplies, it said.
"With households spending on average more than one-third of their incomes on food, the food price hikes have affected purchasing power, particularly of the urban poor and some rural groups, although higher food prices benefit net food producers in rural areas," it said.
"In addition, international prices of energy, industrial materials and agricultural products continue to rise and will gradually exert their influence on domestic prices."
Premier Wen Jiabao and other officials have repeatedly called for the stabilisation of food prices, voicing worries that rising costs of food could lead to social unrest.
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The Chinese government has targeted eight percent economic growth for this year while aiming to maintain inflation at 4.8 percent.
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