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China GDP 'to remain above 8%' despite slowdown
By Wang Yanlin |
April 11, 2012, Wednesday
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Online Edition
Online Edition
CHINA'S economic growth is set to moderate sightly over the next two years but will still exceed 8 percent annually on the back of strong investment, rising private consumption and a more stable global economy, an Asian Development Bank report stated this morning.
The world's second-largest economy may post gross domestic product growth of 8.5 percent this year and 8.7 percent next year after delivering a rise of 9.2 percent in 2011, the bank said in its latest Asian Development Outlook 2012.
The report said the United States will maintain its slow economic recovery, and the eurozone debt crisis is unlikely to worsen.
"The global environment remains very uncertain but China is showing healthy signs of economic diversification with domestic consumption up and the trade surplus down," said ADB Chief Economist Changyong Rhee.
Fixed-asset investment is likely to remain the main engine of growth, expanding more than 20 percent annually in 2012 and 2013, with public infrastructure and housing partially offsetting a slowdown in private sector real estate construction.
Private consumption is forecast to grow about 12 percent over the next two years, supported by employment and wage growth, as well as government spending.
"However, rising income inequality and strains on the environment highlight the need to continue the push for a more balanced, eco-friendly growth model," Rhee added.
The report said there will be some challenges for policy makers, including tackling income equality and reducing pressure on natural resources, both of which threaten the sustainability of future growth and poverty reduction.
"This will require stepped up investment in rural areas and more comprehensive social security safety nets, as well as stronger management of water and other natural resources, as well as improving energy efficiency," the report said.
"With a strong fiscal position and declining inflation, the government is now well placed to push ahead with planned measures to reduce regional and rural-urban income gaps and to cut industrial water consumption and energy use, which will help accelerate the country's economic transformation," the report said.
The world's second-largest economy may post gross domestic product growth of 8.5 percent this year and 8.7 percent next year after delivering a rise of 9.2 percent in 2011, the bank said in its latest Asian Development Outlook 2012.
The report said the United States will maintain its slow economic recovery, and the eurozone debt crisis is unlikely to worsen.
"The global environment remains very uncertain but China is showing healthy signs of economic diversification with domestic consumption up and the trade surplus down," said ADB Chief Economist Changyong Rhee.
Fixed-asset investment is likely to remain the main engine of growth, expanding more than 20 percent annually in 2012 and 2013, with public infrastructure and housing partially offsetting a slowdown in private sector real estate construction.
Private consumption is forecast to grow about 12 percent over the next two years, supported by employment and wage growth, as well as government spending.
"However, rising income inequality and strains on the environment highlight the need to continue the push for a more balanced, eco-friendly growth model," Rhee added.
The report said there will be some challenges for policy makers, including tackling income equality and reducing pressure on natural resources, both of which threaten the sustainability of future growth and poverty reduction.
"This will require stepped up investment in rural areas and more comprehensive social security safety nets, as well as stronger management of water and other natural resources, as well as improving energy efficiency," the report said.
"With a strong fiscal position and declining inflation, the government is now well placed to push ahead with planned measures to reduce regional and rural-urban income gaps and to cut industrial water consumption and energy use, which will help accelerate the country's economic transformation," the report said.
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