Less is more

6 July 2010 By Wei Gu

China’s growth is slipping, but from the heady 12 pct to the new normal of 89 pct. Rebalancing away from investment and trade will hurt growth, though the pain is necessary to reduce financial risks. Financial stalemate is a concern, but the marathon runner looks in good shape.

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China is experiencing a "slight slowdown" in growth but remains on track to achieve a 9.5 percent rise in GDP this year, Lu Zhongyuan, a deputy director of the State Council Development Research Centre, told the People's Daily newspaper on July 5.

Chinese Premier Wen Jiabao said on July 3 China must work to promote stable and relatively fast domestic economic growth, restructure the economy and manage inflation expectations to ensure the government's goals for 2010 are met.

The official purchasing managers' index (PMI) fell to 52.1 in June from 53.9 in May. The reading was the lowest since February and was weaker than the median forecast of 53.1 in a Reuters poll of 10 economists.

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