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WB: China's economy to grow 8.7% in 2008
(Xinhua)
Updated: 2006-12-14 11:14
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China's economy may have modest downslide after 2006, with itsGDPgrowth to slow from the current 10.4 percent to 9.6 percent in 2007 and 8.7 percent in 2008, said aWorld Bankreport on Wednesday.
The World Bank released its annual report -- Global Economic Prospects 2007 inBeijingon Wednesday, which gives a medium-term outlook for China's economy in a special section of regional economic prospects.
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"China's economy remains favorable in the coming years," said Richard Newfarmer, the report's lead author.
According to the report, China's export growth rates are projected to decelerate toward 14 percent in 2008, lower than the estimated 20.3 percent increase in the year 2006, noted the report.
Richard New farmer said the modest slowdown is not a bad thing for China, which will help ease pressure on China's economic growth.
The report also said in the coming years, signs of overheating in China will be limited to specific sectors and regions. While production capacity continues to expand in line with demand, inflation remains low, and the current account is in surplus -- all of which augur well for a soft landing.
But the report also mentioned that high investment rates and excess capacity in several sectors dominated by state-owned enterprises will leave open the possibility of a sharp decline in investment.
The year 2006 witnessed China's efforts to contain its soaring investment for a balanced economy.
Rapid investment growth, and a surge in exports as new capacity came on stream, saw the Chinese economy expand by 10.7 percentyear-on-yearin the first nine months of 2006.
Investment demand in China was particularly strong in the first half of 2006, but the World Bank report said China's efforts to contain investment via tighter monetary policy and sector-specific administrative measures have resulted in a modest slowing of GDP in the third quarter to a 10.4 percent pace.
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