The Chinese economy is forecast to grow by more than 9 % this year, according to an annual blue paper released by the Chinese Academy of Social Science last week. Despite the huge uncertainty in 2009, China could still achieve a 9% growth as long as it unveils timely and suitable macro-economic control measures to boost domestic demand, said the blue paper. Economic growth slowed to 9 %in the Q-3 from 10.4 %in the first half and 11.9 % in 2008. Economic data for October and November showed further downside risks. Amid rising worries over an economic slump, China unveiled a 4 trillion Yuan (US$581B) stimulus package on Nov. 9 to boost domestic demand. It has also cut the lending rate by 1.08% pts as of Nov. 27, the largest reduction in 11 years and the fourth cut since mid September 2008
The government think tank also said the consumer inflation could be below 5 percent next year. The agency called to tap domestic demand potential and improve foreign trade polices to help exporters through the hard times. It also urged to grasp the opportunity of slumping oil prices to reform the pricing mechanism of energy. China’s producer prices tumbled by the most in almost seven years and inflation cooled to the weakest pace since 2006 as the government struggled to revive growth in the world’s third-biggest economy. Consumer prices rose 1 percent in January from a year earlier, the statistics bureau said today, after gaining 1.2 percent in December. Producer prices fell 3.3 % after a 1.1 % decline. Lunar New Year celebrations last month may have contributed.
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