China’s economic growth may weaken this quarter to the slowest in three years mainly due to the curbs on the property sector and weak external demand, the central government’s think-tank said in a report.
The China Information Center forecast the country’s gross domestic product will grow 7.5 percent in the second quarter of this year from the same period of last year, the slowest since the first quarter in 2009.
The forecast is in line with Premier Wen Jiabao’s remarks in March, and was lower than the 8.1 percent growth in the year’s first three months.
The report said the two factors contributing to the slowdown are “the pains” China must face during the transformation and upgrade of its economic structure.
The report comes as data showed that home prices in the country, excluding those for government-funded affordable housing, fell last month in 46 of the 70 cities tracked by the National Bureau of Statistics, a record high since the figures were first released.
The think-tank also expected inflation to cool to 3.3 percent in the second quarter due to weaker domestic demand. The Consumer Price Index rose 3.4 percent in April on an annual basis.
“China should step up fine tuning of economic policies,” the report said. “It should implement tax cuts, increase support for technological transformation, and reduce fundraising cost for companies to sustain stable economic growth.”If you think China Watch Blog's information is useful, click on cup of coffee on left hand side and make a small contribution via PayPal