China's economic growth is expected to slow over the next 18
months as the pace of fixed-asset investment falls, a UN report
said yesterday.
"A gradual slowdown is necessary because we have faced many,
many challenges," Wang Huijiong, vice-chairman of the Academic
Commission of the State Council Development and Research Center,
authorized by the UN to deliver the report, told China
Daily.
The UN Economic and Social Commission for Asia and the Pacific's
annual report also noted that rising oil prices and the tsunami of
December 26 had undermined some Asian economies.
It predicted China will register an annual economic growth rate
of 8.5 percent this year, lower than last year's 9.5 percent,
slowing to 7.8 percent in 2006.
The commission concluded that the economic slowdown in China
will also affect the speed of economic development in the rest of
the region.
China's economic growth for the first quarter of this year was
9.5 percent, higher than the government's goal of 8 percent.
Wang said the biggest challenge facing China's economic
development is over hasty investment in the fixed asset market in
the past several years.
"We must slow down our pace, otherwise our growth cannot be
sustained because of strains on resources and inflation pressures,"
said Wang.
The report said China's economy has played a major role in
driving sustained growth in the Asia-Pacific region with a GDP
growth rate of 8.2 percent a year on average between 1998 and
2004.
In his foreword to the report, UN Secretary-General Kofi Annan
said the fast pace of economic growth for countries in the
Asia-Pacific region was driven by resilient exports and domestic
demand.
"The prospects this year have been undermined in countries
affected by the tsunami disaster and other factors," said
Annan.
The commission forecasted that the region as a whole would
achieve 6.2 percent economic growth this year, down from last
year's 7.2 percent.
Looking to the long term, it warned that many countries in the
region should pay close attention to the problems of an ageing
population.
By 2050 about 23.5 percent of people living in the region will
be aged 60 or above - 29.9 percent in China. Worldwide, the average
rate is 21.1 percent.
"China's challenge of ageing is the biggest in the world," said
Wang, urging the government to take efficient measures to cushion
pressures brought about by its ageing society.
(China Daily April 26, 2005)