The National Bureau of Statistics of China says the country is on track to hit 8 percent GDP growth this year. According to the NBS, the economy grew by 7.9 percent in the second quarter of this year compared to the same time last year. The year over year increase is 7.1 percent.

The government credits the growth to a number of factors including increased industrial production, higher incomes among urban and rural residents and improved retail sales. Retail sales reportedly increased by 15 percent in the first six months of the year, thanks to government incentives like rebates.

The Financial Times also notes that the government's stimulus program played a major role: "The high-speed growth, above analysts' consensus forecasts, was driven by the government's aggressively loose fiscal and monetary policies, funded largely by record lending by state banks." The NBS says loans made by the country's financial institutions increased by 7.4 trillion yuan over the beginning of this year, an increase of 4.9 trillion yuan compared with the same period last year.

Some analysts suggest that the news out of China proves the country will help lead the world out of a global recession, but others remain unimpressed. Tim Holland of the South China Morning Post (sub req'd) warned earlier this month that economic figures from the Chinese government can't always be trusted. Holland points to foreign trade as important factor in growth, which often seems to be at odds with the country's GDP figures. According to the NBS, the total value of imports and exports this year is down by 23.5 percent.

categories: China

12:38 - July 16, 2009

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