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China's Economy Grew 10.5% in 2006
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China's economy grew by 10.5 percent in 2006, notching up double-digit growth for the fourth year in a row, the chief of the country's top planning agency said.

The rate was in line with economists' expectations. Gross domestic product expanded 10.2 percent in 2005.

"According to initial calculations, China's GDP value in 2006 has reached 20 trillion yuan, or around US$2.56 trillion, an increase of 10.5 percent over 2005," said Ma Kai, head of the National Development and Reform Commission.

Ma Kai said on Friday that China's economy kept up fast and stable development last year, while investments in fixed assets started to cool down in the second half of 2006.

In a report on the agency's Web site, www.ndrc.gov.cn, Ma Kai said the economy was still growing too fast, imposing an unacceptably high cost in terms of energy use and environmental damage.

Ma Kai said the Chinese government had managed to ease the problem of overcapacity by clamping down on wasteful capital spending, but he expressed concern that a recent easing in credit and investment growth was not well entrenched.

"The foundation of the slowdown in investment and credit is still not solid enough and the problem of our international payments imbalance is worsening," Ma said.

China reported a record trade surplus for 2006 of US$177.5 billion.

Ma said the government would continue to refine its macroeconomic controls in 2007 to keep the economy on a sound footing.

(CRI January 13, 2007)

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