04/16/2009, 00.00
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China’s GDP growth to slow to 6.1 per cent

This is the weakest growth since 1992. According to the government, an 8 per cent annual growth rate is needed to maintain employment levels and keep social unrest in check. But positive signs are on the horizon, thanks to the government’s four trillion yuan stimulus package.
Beijing (AsiaNews/Agencies) – China's annual GDP growth slowed in the first quarter of 2009 to 6.1 per cent, according to the National Bureau of Statistics (NBS). This is the weakest rate since quarterly records began in 1992.

Growth was 6.8 per cent in the last quarter of 2008 and economists had forecast about 6.3 per cent amid the global collapse in trade.

A month ago Chinese Premier Wen Jiabao had said that his government’s goal was to achieve an annual rate of growth of 8 per cent, seen as necessary to maintain employment and forestall unrest due to unemployment.

China’s growth stood above 10 per cent between 2003 and 2007, and was 9 per cent in 2008, but its export-led economy has suffered from a steep decline in foreign demand. Tens of thousands of factories have had to close for lack of orders.

At present, the “national economy is confronted with the pressure of a slowdown,” the NBS said in its statement. This is the result of lower demand, which has cut into corporate profits and tax revenues, with more and more job losses.

Officially the jobless are around 20 million, but could actually be around 50 million since many migrants are hired without contracts and fired without being counted.

There are signs that the recovery is underway, the NBS said. In March industrial output rose by 8.3 per cent, up from 3.8 in the first two months of the year.

But the upturn in the economy is driven by the government stimulus package worth 4 trillion yuan (US$ 585 billion). Many experts think this will be short term.

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