Chinese growth may accelerate to 10.2%

CHINA'S ECONOMIC growth may accelerate in the third quarter to 10

CHINA'S ECONOMIC growth may accelerate in the third quarter to 10.2 per cent as industrial production quickens and Sichuan province rebuilds after the May 12th earthquake, a government research agency has said.

Inflation will slow to 6.6 per cent, the State Information Centre said in a research paper published yesterday in the official China Securities Journal.

"Keeping economic growth stable and relatively fast and controlling excessive inflation" should be the government's top priorities, the researchers said, echoing the language of statements by Chinese president Hu Jintao and the Politburo, the Communist Party's top decision-making body.

Quicker growth would mark a rebound. The world's fastest-growing major economy has slowed for four consecutive quarters after expanding 12.6 per cent in the three months to the end of June 2007 from a year earlier.

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Gross domestic product (GDP) grew 10.1 per cent in the second quarter of this year.

China's inflation was 7.9 per cent in the six months to the end of June, the fastest pace since 1996.

Chinese authorities however say their efforts to rein in price rises would not be at the expense of economic growth. Last week Mr Hu said the government would focus on both objectives simultaneously.

GDP growth was sapped in the first half by the effects of snowstorms and the earthquake, according to the report.

Urban fixed-asset investment may climb 28.5 per cent in the third quarter from a year earlier, exports may rise 20.3 per cent, and the trade surplus may narrow by 10.4 per cent, the report said.

It also said producer prices may climb 8.8 per cent on increased energy and raw-material costs. - (Bloomberg)