China’s economy continued to slow further as it dipped to 7 per cent in the first quarter, the worst slump since the 2009 global financial crisis, raising concerns over the deceleration of the world’s second largest economy.
While China met an annual growth target of about 7 per cent set by its central government for 2015, it declined from the previous quarter’s 7.3 per cent.
Last year, China’s GDP had registered a growth of 7.4 per cent, a 24 year-low.
The continued slowdown has become a major concern for policymakers as forecasts say the world’s second largest economy will continue to decelerate till next year.
A recent IMF forecast said China’s growth would further decline to 6.8 this year and 6.3 next year, falling behind India’s 6.5 per cent.
“The Chinese economy is generally holding steady in the first quarter because employment, consumer prices and market expectations are basically stable, despite a slowdown in economic growth,” said National Bureau of Statistics (NBS) spokesperson Sheng Laiyun at a press conference in Beijing.
He said the slowdown was expected as the Chinese government has predicted tough challenges and continued downward pressure for the economy this year.
He attributed the slowdown to sluggish global economic recovery in the post-crisis period and the ongoing structural reforms at home.
The first-quarter gross domestic product (GDP) totalled 14.07 trillion yuan (USD 2.29 trillion) up 7 per cent year-on-year, according to the NBS data.
The data also indicated a robust industrial output growth of 7.9 per cent in the tertiary industry during the period.
During the first quarter, industrial output in general grew 6.4 per cent year-on-year, down from 8.7-per cent growth a year ago; fixed asset investment rose 13.5 per cent from a year earlier to 7.75 trillion yuan, slowing further from the 13.9-per cent growth registered in the January-February period this year; retail sales gained 10.6 per cent year-on-year to 7.07 trillion yuan, the data showed.
He said that despite slower industrial output and investment growth, the country has steadily pushed structural reforms that led to a better industrial layout and rise in people’s income.
The tertiary industry accounted for 51.6 per cent of the total GDP in the first quarter, up 1.8 percentage points compared to the same period last year.
Its share of the GDP also exceeded that of the secondary industry by 8.7 percentage points.
The average per capita disposable income of Chinese households rose 9.4 per cent year-on-year to 6,087 yuan.
The consumer price index, a main gauge of inflation, was registered at 1.2 per cent in the first quarter.
