|A worker works at a construction site in Chengdu, capital of southwest China's Sichuan Province, Jan. 14, 2013. China's economic expansion slowed to 7.8 percent year on year in 2012 amid external jitters and domestic woes, data from the National Bureau of Statistics showed Friday. (Xinhua/Li Hualiang)
BEIJING, Jan. 19 (Xinhua) -- China will witness a moderate economic recovery this year while a rapid rebound in inflation is unlikely, according to a chief economist.
Despite the uncertainty in external markets, which is considered to be the major challenge for China this year, the country is likely to record 8.6 percent economic growth in 2013, Qu Hongbin, HSBC China chief economist said.
The continued slowdown in the U.S. economy and recession of the European Union will continue to weaken China's external demand and keep the country's foreign trade growth under 10 percent this year, said Qu in an interview in Saturday's China Securities Journal.
China's economy posted its weakest expansion in a decade in 2012 by growing 7.8 percent year on year, according to the National Bureau of Statistics (NBS).
In the fourth quarter last year, economic growth quickened to 7.9 percent year on year after government pro-growth measures, ending a seven-straight-quarter slowdown.
Qu attributed the economic recovery to an acceleration in infrastructure investment and a rebound in the property sector, and said maintaining the upward trend to avoid a "W-shape" recovery will be crucial to this year's macro-economic policies.
The major task for policymakers will be ensuring a certain speed of growth in infrastructure investment while keeping the real estate market basically stable, he said.
Qu said the government should maintain the current relatively loose monetary policy, or a moderate growth in social financing, via quantitative tools like cutting required reserve ratio and conducting reserve repos instead of lowering bank interest rates.
Qu said he expected the government to be more active in fiscal policies and take further moves in structural tax reduction, as well as increasing public spending in fields related to people's livelihood.
The moderate growth, which is slower than the country's potential growth rate, will reduce risks of a rapid rebound in inflation and leave room for government policies to stay loose, he said, adding that it is not necessary to raise the bank interest rates.
Qu said China's potential growth rate will stay at around 9 percent in the next few years, a decline from the 10 percent level in the past decade.
This mainly reflects subtle changes in the country's population trend, he said.
In 2012, the number of working-age people in China decreased by 3.45 million to 937.27 million, NBS data showed. It is the first time the country has recorded an absolute drop in the working-age population in "a considerable period of time," according to the NBS chief, Ma Jiantang.
Qu said it is a bit of an exaggeration to say that changes in population trend caused a drop in labor expansion and will lead to a decline in the country's potential growth rate.
In the past ten years, the growth in labor has only contributed less than one percentage point to China's double-digit growth, he said.
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BEIJING, Jan. 18 (Xinhua) -- China's economy rebounded in the fourth quarter of 2012 but also recorded its first annual growth rate of less than 8 percent since 1999.
China's gross domestic product grew 7.8 percent year on year to reach 51.93 trillion yuan (8.28 trillion U.S. dollars) last year due to both external and domestic factors, data from the National Bureau of Statistics (NBS) showed on Friday. Full story
Bank predicts 8.5 pct China growth in 2013
SHANGHAI, Jan. 20 (Xinhua) -- Economic growth in China will be about 8.5 percent this year, with domestic demand being the driving force for expansion, a Bank of Communications report predicted.
Demand from Europe and the United States will bottom out and boost Chinese trade. Exports will rise about 8.5 percent this year from 2012 and imports will climb 10 percent, the report released on Friday said. Full story