These days, we have so many people saying positive things about the management of the Chinese economy. Today the Chinese Academy of Sciences,an official think tank forecast China’s gross domestic product (GDP)to expand around 10 pct in 2010,mainly driven by investment and domestic consumption. This was reported in the official Xinhua agency today(7 February 2010).Let us read Xinhua's report.
"Strong first-quarter growth of 11 pct will slow slightly for the rest of the year, with the pace of expansion dipping just below 10 pct in the second half, the Center for Forecasting Science at the Chinese Academy of Sciences said in the report, which was issued at the weekend.
Growth in the third and fourth quarters will be 9.5 pct and 9.8 pct respectively, it said.
Foreign trade will rebound as the global economy improves, but overall net exports will be a drag on growth, bringing GDP expansion down by around 0.5 pct.
Exports will rise 16.6 pct and imports by 18.9 pct, with the overall value of foreign trade up 17.6 pct.
The government’s economic stimulus plan, which aims to bolster the Chinese economy amid the economic slowdown, will continue to drive investment, but growth will slow to 25 pct from 30.1 per cent in 2009, the report said.
It also forecast a 3.1 pct rise in the consumer price index as the economic revival, ample liquidity and inflation expectations drive up prices.
While seemingly mild given the extent of China’s monetary stimulus over the past year, the higher inflationary expectations are likely to worry those already concerned about the possibility of economic overheating.
China’s GDP last year grew 8.7 pct. The median 2010 GDP forecast of economist polled by Reuters late last month was 9.5 pct.
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