China says economy grew 10.3% in 2010
2011-01-20 17:54:26
China said Thursday that its economy grew 10.3 per cent in 2010, marking the fastest annual pace since the onset of the financial crisis and underlining the country's growing might.
Gross domestic product in China rose by 9.8 per cent in the fourth quarter, exceeding analyst expectations, while consumer inflation lost a bit of steam in December as Beijing moved to rein in soaring prices.
The 2010 GDP figure, up from a revised 9.2 per cent growth in 2009, highlighted China's powerful performance in a year when it overtook Japan to become the world's second-largest economy behind the United States.
"Currently the economy is in a critical period of transforming from recovery to stable growth," Ma Jiantang, Commissioner of the National Bureau of Statistics, told reporters.
Ma said China would step up efforts to transform the country's "economic growth pattern" -- referring to the Beijing's oft-stated aim to boost domestic consumption and reduce its reliance on exports and investment.
His comments were echoed by President Hu Jintao, who told US business leaders during a high-profile visit to Washington on Wednesday that China would boost interior demand and consumer spending.
The country's consumer price index, the main guage of inflation, rose by 4.6 per cent year-on-year in December compared with 5.1 per cent in November, which was the fastest pace in more than two years.
The index rose 3.3 per cent for all of 2010 -- exceeding the government's full-year target of three per cent as food costs soared.
"We should have full confidence that we will be successful in 2011."
Analysts said the still-high inflation figure in December supported the case for further interest rate hikes and bank lending restrictions.
"Price pressures will remain uncomfortably strong in the months ahead, and the dip in headline CPI inflation in December will likely be temporary," said Brian Jackson, an analyst at Royal Bank of Canada.
IHS Global Insight analyst Alistair Thornton agreed.
"A new wave of credit expansion is driving inflationary pressure, in both consumer prices and asset markets, with a re-acceleration in construction and fixed investment," Thornton said.
Output from the country's millions of factories and workshops rose 15.7 per cent for all of 2010, faster than in 2009 as manufacturers cranked up activity to meet growing demand for Chinese-made goods.
Urban fixed asset investment, a measure of government spending on infrastructure, rose 24.5 per cent over the 12 months -- slower than in the previous year as Beijing started to wind back crisis-stimulus measures.
Retail sales, a key indicator of consumer spending, rose 18.4 per cent in 2010.
As the United States and Europe struggle to spur growth, Beijing has been trying to slow its economy and stem a flood of liquidity that is fanning inflation and driving up property prices, straining household budgets.
The central bank last Friday again ordered banks to increase the amount of money they keep in reserve, effectively putting a cap on lending, after raising interest rates twice in the fourth quarter.