Economic Growth in China May Reach 8.2% in 2013
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Citing proactive fiscal policy and planned market reforms, growth in the world’s second largest economy could enjoy a rebound to 8.2 percent in 2013, said the Chinese Academy of Social Sciences, the country’s top academic and policy research institute.
The CASS, however, said that its GDP forecast is contingent on the stabilisation of the European debt crisis and the United States avoiding the expiration of Bush-era tax cuts as well as automatic cuts to defence and domestic spending programmes.
Citing proactive fiscal policy and planned market reforms, growth in the world’s second largest economy could enjoy a rebound to 8.2 percent in 2013, said the Chinese Academy of Social Sciences, the country’s top academic and policy research institute.
The CASS, however, said that its GDP forecast is contingent on the stabilisation of the European debt crisis and the United States avoiding the expiration of Bush-era tax cuts as well as automatic cuts to defence and domestic spending programmes.
China has had a remarkable decade of double-digit growth but will see its economy slow to a low of 7.5 percent growth this year as a result of weak export markets and cooling down in Beijing’s property market, the OCED said last Tuesday.
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But there are already signs of an economic revival as two recent purchasing managers’ index surveys showed that activity in China’s manufacturing sector quickened for the first time in 13 months in November.
The CASS said:
[quote] We are cautiously optimistic on the outlook for 2013. We should be alert to possible downside risk and be prepared with enough policies. [/quote]
According to a report by Reuters, the think tank said in its “blue book” report that Beijing should intensify proactive fiscal policy next year, including “appropriately” expanding the fiscal deficit and “increase investment on infrastructure investment from central revenue.”
CASS also recommended extending value-added tax reforms to more regions and sectors while cutting VAT rates.
The recommendations are largely in line with the central government’s official “proactive” fiscal policy and “prudent” monetary policy stance, as well as the new Xi – Li administration’s commitment to long-term structural reforms and high-quality returns on growth.
Speaking at a Politburo meeting yesterday, newly-appointed Premier Xi Jinping said authorities plan to maintain controls over the important real estate sector and hinted that the introduction of further cooling measures cannot be ruled out.
China has not yet issued an official GDP forecast for 2013 but the Central Work Committee Meeting on economic policy is expected to be held next week.
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