China's economy to grow 10.5 pct

Updated: 2006-10-16 11:22

BEIJING - China's annual economic growth is expected to slow to 10.5 percent in 2006 as government measures to cool the economy have some impact, a senior official from a top government think-tank said in remarks published on Monday.

While the economy had grown rapidly in the first half, fixed-asset investment and credit growth had slowed in July and August, the Shanghai Securities Journal quoted Fan Jianping, head of the State Information Centre's forecasting unit, as saying.

"As long as the government doesn't relax its tightening stance, we reckon economic growth will slow slightly and remain high, and that the economy will grow by an annual 10.5 percent this year," Fan said.

Still, the economy would be faced with problems such as the risk of an investment rebound and excess liquidity.

Annual fixed-asset investment growth was expected to slow to around 26.5 percent for the whole year from 29.8 percent in the first half, he said.

Retail sales were expected to grow 13.7 percent on the year in the second half and 13.5 percent for the full year.

Exports would grow 24.5 percent this year from a year earlier, while imports would likely expand 21.5 percent, he said.

China's trade surplus would near $150 billion in 2006, up around 40 percent compared with the previous year, he said.

The economy was most likely to grow 9.5 percent next year but could expand by as much as 10.5 percent or as little as 8.5 percent, depending on the situation.

The latter forecast was the most unlikely scenario, he added.

China's economy grew by an annual 11.3 percent in the second quarter and by 10.2 percent in 2005.