China has average economic growth of 9.67 pct between 1978 and 2006

11 May 2007

Beijing, China, 11 May – Between 1978 and 2006 China posted average annual economic growth of 9.67 percent, official Chinese news agency New China reported Thursday, citing the director of the government economic planning agency.

“Chain’s annual growth rate was much higher than that of the average world Gross Domestic Product (GDP) in those same years, which remained at 3.3 percent,” said Ma Kai, director of the Commission for National Reform and Development.

“As the country is increasingly opened up to the world, China has received more foreign direct investment than any other developing country for 14 years in a row and by the end of 2006 had 590,000 foreign companies,” said Ma Kai.

China’s central bank, recently announced forecast two-digit GDP growth forecasts for 2007.

According to the central bank’s research department, China will have 10 percent growth in 2007, after GDP growth of 10.7 percent in 2006, driven by exports and by high levels of investment in fixed assets.

For decades, China’s economic policy was focused on growth and only recently have issues such as pollution, power consumption and unequal pay hit the political agenda.

The rapid growth of the world’s fourth largest economy has caused some concern to the government, which fears a potential inflation rate rise due to rapid economic growth will leave families, companies and banks exposed to excessive levels of debt, with political and social consequences.

In order to try to cool the economy down, the Chinese central bank has taken steps for macro-economic control, such as increasing interest rates and the levels of cash reserves that banks must deposit in the central bank. (macauhub)