China to grow at 11.3% in 2007: World Bank

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Wednesday, September 12, 2007 at 1234 hrs China's economy will grow 11.3 per cent this year, the World Bank forecast on Wednesday even as it suggested more fiscal and structural policy measures to rebalance it.

The World Bank now projects Gross Domestic Product (GDP) growth of 11.3 per cent in 2007, but below 11 per cent in 2008, the World Bank's China Quarterly Update released in Beijing said.

China's GDP expanded 11.9 per cent in the second quarter this year, lifting first-half (January-June) growth to an impressive 11.5 per cent.

China's macroeconomic prospects remain good, it said, noting that internationally, there are no indications that cost pressures are reducing the competitiveness of China's exports.

Domestically, prospects remain buoyant. Profit and credit growth are high, so investment is likely to continue to expand strongly.

Consumption is expected to remain solid, although higher inflation is constraining real consumption growth, the report said.

International food prices are expected to increase further, but industrial commodity and producer price rises may continue to moderate.

The World Bank expects CPI inflation to gradually ease from later in 2007 onwards, but thinks there are upward risks.

The Bank said it projects a current account surplus of around 12 per cent of GDP in 2007.