January 23, 2008

China GDP growth to ease to 10.5 percent: researcher

BEIJING (Reuters) - China's economic growth may ease slightly this year to 10.5 percent from the estimated 11.5 percent rate of expansion in 2007, a researcher at a state think-tank said on Friday, as the government cooling steps take effect.

Zhang Liqun, a researcher with the Development Research Centre, which falls under the cabinet, said the government's cooling measures were intended to just moderate growth, and consumption, investment and exports would remain strong.

 

He predicted the pace of inflation would ease slightly, with the consumer price index likely to rise 4.5 percent rise in 2008 from an expected 4.8 percent increase in 2007.

"Macro-economic controls are aimed at maintaining stable economic growth rather than at putting a sudden brake on the economy," Zhang told an economic conference.

Zhang said the government's economic policies would be little changed from 2007, but Beijing could clamp down on big polluters as it strives to improve energy efficiency.

Last year, China raised interest rates six times and banks' reserve requirements 10 times and began to clamp down on commercial lending.

The central bank lifted reserve requirements this week for the first time this year and there are also indications that it has kept up its credit controls.

Ji Min, a researcher at the People's Bank of China, said in a statement at the meeting that the central bank would continue to raise the reserve requirement ratio in 2008 as a way to absorb excess liquidity in the economy.

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