China's economic boom goes on

FE Team | Published: October 26, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

Richard McGregor
FT Syndication Service
BEIJING: China's economy maintained its rapid growth in the third quarter, expanding by 11.5 per cent, leaving it on track to grow by its fastest annual rate since the 13.1 per cent pace achieved in 1993.
The third quarter represented a slightly slower pace than the second quarter, when output rose by 11.9 per cent.
The marginally slower pace was largely due to a series of government tightening measures, including successive interest rate rises, directives to state banks to cool lending and tighter enforcement of environmental rules.
Even with the slower pace in the third quarter, the central government's tightening measures are expected to continue until at least the end of this year.
Wen Jiabao, the premier, reinforced this message in a statement to the State Council, or Cabinet, on Wednesday, saying China need to continue to control investment and credit growth.
Mr Wen also reaffirmed the government's decision to keep all government-controlled fixed until the end of the year, part of an effort to keep a lid of inflation.
Monthly inflation reached an 11-year high of 6.5 per cent in August, mainly because of rising food prices, and has since subsided slightly.
The National Bureau of Statistics, which released the growth figures on Thursday, confirmed a disclosure by a senior official last week that annual consumer inflation slowed to 6.2 per cent in September from 6.5 per cent in August.
Mr Wen said in his address to the cabinet that China needed to slow the rise in consumer prices and prevent the overly rapid increase in property prices.
China's main problem continues to be managing high-speed growth, which is still the single most important aim of the government's economic policy.
A spokesman for the National Bureau of Statistics said at a press conference announcing the latest growth figures that the "institutional, systemic and structural problems existing in economic performance are still pronounced."
"These problems include rapid economic growth, price rises, high pressure on energy consumption and pollutant emission reduction, and the uncertainty of world economic growth."