China's economy grows 9% in 2008

BEIJING:China's economy cooled to its slowest pace in seven years in 2008, expanding 9 percent year-on-year as the widening global financial crisis continued to affect the world's fastest-growing economy, official data showed Thursday.

Gross domestic product (GDP) reached 30.067 trillion yuan (4.4216 trillion U.S. dollars) in 2008, Ma Jiantang, director of the National Bureau of Statistics (NBS), told a press conference.

The 9-percent rate was the lowest since 2001, when an annual rate of 8.3 percent was recorded, and it was the first time China's GDP growth fell into the single-digit range since 2003.

The year-on-year growth rate for the fourth quarter slid to 6.8percent from 9 percent in the third quarter and 9.9 percent for the first three quarters, according to Ma.

Economic growth showed "an obvious correction" last year, but the full-year performance was still better than other countries affected by the global financial crisis, said Zhang Liqun, a researcher with the Development Research Center of the State Council, or cabinet.

He attributed the fourth-quarter weakness to reduced industrial output as inventories piled up amid sharply lower foreign demand.

Exports, which accounted for about one-third of GDP, fell 2.8 percent year-on-year to 111.16 billion U.S. dollars in December. Exports declined 2.2 percent in November from a year earlier.

Economist Wang Xiaoguang, who is with the Economic Research Institute of the National Development and Reform Commission, a think tank, said the 6.8-percent growth rate in the fourth quarter was not a sign of a "hard landing," just a necessary "adjustment" from previous rapid expansion.

"This round of downward adjustment won't bottom out in just a year or several quarters but might last two or three years, which is a normal situation," said Wang.

Zhang predicted the economy will touch bottom and start to recover later this year, depending on the performance in January and February.

He forecast GDP growth of more than 8 percent for 2009, based on the assumption that domestic demand and accelerating urbanization would help cushion China from world economic conditions.

Ma said he was "fully confident about China's economy in 2009 and beyond." He characterized the "difficulties" China experienced in the fourth quarter as temporary.

Overall, the economy maintained good momentum with fast growth, stable prices, optimized structures and improved living standards, said Ma.

China's performance was better than the average growth of 3.7 percent for the world economy last year, 1.4 percent for developed countries and 6.6 percent for developing and emerging economies, he said, citing estimates of the International Monetary Fund.

"With a 9-percent rate, China actually contributed more than 20percent of global economic growth in 2008," said Ma.

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