CHINA’S GROWTH MAY SLIP TO 8.6% THIS YEAR AS EUROPE SLOWS, REPORT SAYS
Bloomberg, February 25, 2012
China’s economic growth may slip to 8.59 percent this year due to slowing in Europe, while inflation will ease to 3.3 percent, according to a Xiamen University and National University of Singapore joint forecast.
Growth may bottom out in the second quarter, slowing to 8.35 percent before picking up again, according to the forecast released today at a forum in Beijing. Expansion in first quarter may be 8.42 percent, down from 8.9 percent in the final three months of 2011.
China’s growth is decelerating as Europe’s sovereign-debt turmoil hurts exports and Premier Wen Jiabao continues trying to cool his nation’s property market. Last month’s decline in overseas sales and weaker-than-forecast lending raised concerns that the world’s second-biggest economy may see a sharper slowdown.
“There are many external uncertainties out there,” Wang Yida, a deputy director at the Ministry of Finance, said today at the forum. “We should be wary about the downward pressure on economic growth brought about by sluggish external demand, although the nation’s economic fundamentals remain sound.”
Wang said today the government will further improve the policy of “structural tax cuts” and boost spending in areas including energy conservation, education and technology to help spur domestic demand.
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