Nation's economy to grow less than 10 percent in 2007
(Xinhua)
Updated: 2006-10-26 09:26
China's economic growth may fall under the 10 percent bar next year as
investment, exports and industrial output slow down, a top think tank
predicted in Beijing on Wednesday.
"With high growth and low
inflation, the economy is ready for a soft landing, despite the problems of
yawning surpluses, too-rapid investment and heavy pressure on environment and
resources," said the Macro Economy Research Institute of the National
Development and Reform Commission in its latest report.
It said that the
government's macro-economic policies have restrained runaway investment and loan
supply.
China's gross domestic product growth (GDP) will slip back to
10.3 percent in the fourth quarter from a second quarter peak of 11.3 percent.
As a result, the year's GDP growth is expected to slow to 10.6
percent.
The Consumer Price Index, an inflation weather vane, will grow
1.5 percent this year, it said.
The report written by economist Wang
Xiaoguang and three other experts claims that the world economy has entered an
adjustment period. "Both trade and economic growth will slow next year. With
flat demand and rising supply of raw materials, prices of oil and other primary
raw materials will drop," it said.
"Next year, China will have to deal
with the toughest situation for exports that it has faced since it entered the
World Trade Organization because the United States, which imports more than 40
percent of China-made exports each year, has seen a marked slowdown in its
economic growth," said the report.
The depreciating U.S. dollar and
relatively high interest rates set by the American Federal Reserve would put
more pressure on China to appreciate the Renminbi (RMB), it noted.
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