Wednesday, November 03, 2010
[IWS] World Bank: CHINA QUARTERLY UPDATE, NOVEMBER 2010 [3 November 2010]
IWS Documented News Service
Institute for Workplace Studies----------------- Professor Samuel B. Bacharach
School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies
16 East 34th Street, 4th floor---------------------- Stuart Basefsky
New York, NY 10016 -------------------------------Director, IWS News Bureau
CHINA QUARTERLY UPDATE, NOVEMBER 2010 [3 November 2010]
[full-text, 23 pages]
See Press Release 3 November 2010
With China’s Economic Prospects Sound, the Focus Shifts to Structural Issues, According to the World Bank
[excerpt from report]
China’s growth has moderated somewhat, with a shifting composition. GDP growth declined from 10.6
% in the first half to a still surprisingly strong 9.6 % (yoy) in the third quarter. The domestic economy
cooled as the stimulus impact is fading out and the monetary stance is being normalized. Investment
and urban consumption have decelerated, and so have imports. Meanwhile, with exports strong, net
external trade has contributed significantly to (yoy) growth and the external surplus is rising again.
The global outlook is broadly favorable, but risks remain. Despite an expected deceleration, global
growth prospects are fairly favorable due to emerging market strength. But risks include a weaker
outlook in high income countries and ample international liquidity as well as the global imbalances and
possibly contentious policies triggered by them. Global price pressures remain contained by spare
capacity in many countries. But there are upward inflation risks internationally.
China’s own economic prospects remain sound, with risks both ways. Growth may ease further as
global growth decelerates and the macro stance is normalized further. However, the expansion should
remain supported by the traditional growth drivers and a robust labor market. We have edged up our
GDP growth projection for 2010 to 10 % after the third quarter data. We see growth at 8.7 % in 2011
and easing somewhat further in the medium term. Pushed up by higher food prices, inflation may stay
above the 3 % target for a while. It is unlikely to escalate as core inflation remains in check. However,
raw commodity prices may rise further while sustained high wage growth is unlikely but cannot be ruled
out. Given the fundamental drivers of property prices, they are unlikely to be contained for long. On
current trends and policies, the external surplus is on course to rise in 2011 and the medium term.
AND MUCH MORE....including CHARTS, GRAPHS, and TABLES....
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