Slowdown in economy set to continue

Source: Xinhua  |   2008-7-2  |     NEWSPAPER EDITION

CHINA'S economy might continue to decelerate as a result of slower industrial output growth and weakening overseas demand, according to a posting on the Website of the National Bureau of Statistics.

The deputy head of the bureau, Xie Hongguang, said uncertainties over China's economic growth still existed. "We should raise our awareness and pay more attention to economic problems," he wrote.

Xie wrote that domestic inflation remained a large problem. "China raised prices for refined oil products and electricity. Meanwhile, prices of large scale commodities were still increasing, which contributed to high inflation. Local governments are active in stimulating the local economy, thus more loans and investments may be granted. However, growth for industrial output and overseas demand slowed down."

In addition, world financial markets were volatile. "Although the US, Japanese and European Union economies performed better than expected, prices of primary products, such as oil and grain, were still rising. Financial markets were adjusting," he wrote.

China has seen some major economic measures slow down for the first time in five years.

Its economy was 6.15 trillion yuan (US$900 billion) in the first quarter, up 10.6 percent on year. However, the growth rate was 1.1 percentage points lower than a year earlier.