GDP In 2007 (And 2008 Projections)

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The Chinese economy grew at a rate of 11.4 percent in 2007 according to a report just released by the National Bureau of Statistics (and reported by AFP). The rate of growth was ahead of the target (but close to recent estimates), and came together with (mainly food-driven) inflation at an 11-year high. AFT notes:

    “The risk of the economy shifting from rapid (growth) to overheating still exists,” Xie Fuzhan, the bureau’s head, told a briefing in Beijing.

    China’s economy last year totaled 24.7 trillion yuan, or 3.4 trillion dollars according to year-end exchange rates.

    Growth in the fourth quarter of 2007 was 11.2 percent, a slight moderation from 11.5 percent in the third quarter, the bureau added.

    Growth in Asia’s second-largest economy was boosted by record exports and massive spending on infrastructure.

    The bureau confirmed previously released statistics which showed the trade surplus last year soared 47.7 percent to 262.2 billion dollars.

    Investment in fixed assets, covering everything from bridges to new equipment in factories, rose 24.8 percent in 2007, the bureau said.

    The rapid expansion came despite government efforts to cool the economy, including six interest rate hikes in 2007, amid concerns that inflation was rising to uncomfortable levels.

    The statistics bureau said inflation last year had struck 4.8 percent, the steepest increase in 11 years. In December, the consumer price index was up 6.5 percent.

Another report, from Forbes quoting an official from the National Development and Reform Commission (NDRC), also makes predictions for 2008. These include:

    • 2008 GDP: 11 percent (est.)

    • 2008 CPI: 4 percent (est.)

    • 2008 Trade Surplus: US$320 billion, up 22 percent (est.)

    • 2008 Investment growth: 23 percent (est.)

The impact of a slowdown in the US and elsewhere, stock market falls, continued high food and resource prices, interest rate and currency movements – and whatever the next global economic shock may be -remains to be seen, but may complicate matters for China’s policy makers.

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