16 Jul 2009 08:48

China's economy picks up in H1 - NBS

By Victor Wang

Shanghai. July 16. INTERFAX-CHINA - China's economy showed signs of recovery in the first half of this year thanks to government stimulus packages, the National Bureau of Statistics (NBS) said on July 16 after releasing key economic data.

China's gross domestic product (GDP) growth reached 7.9 percent year-on-year in the second quarter of this year, up from the 6.1 percent growth rate in the first quarter. GDP in the first six months of the year topped RMB 13.99 trillion ($2.05 trillion), representing an increase of 7.1 percent year-on-year, according to the NBS.

The year-on-year growth rate of industrial output, another key yardstick of the overall health of the economy, lifted from 5.1 percent in the first quarter to 9.1 percent in the second quarter. Industrial output from January to June expanded by 7 percent from the same period a year ago.

Fixed-asset investment and retail sales figures over the past six months were also promising, the NBS said.

Fixed-asset investment jumped by 33.5 percent year-on-year to RMB 9.13 trillion ($1.34 trillion) while retail sales grew by 15 percent year-on-year to RMB 5.87 trillion ($859.31 billion) in the first half of the year.

However, China's producer price index (PPI) and consumer price index (CPI) shrank by 5.9 percent and 1.1 percent year-on-year respectively in the six-month period due to plunging commodity prices on the international market coupled with supply surpluses in many industrial sectors, the NBS said.

"China's performance in the second quarter exceeded even the most optimistic of market expectations. The economy is now going through a 'V-shape' recovery, and is outperforming other economies in the world," economist Dong Xian'an, from Industrial Securities, said.

However, the NBS seems to be downplaying the statistics. "These results do not point to an overly solid foundation and there are uncertainties ahead of us. The government will continue to implement strong fiscal and monetary policies to ensure further economic recovery in the second half of the year," Li Xiaochao, spokesman for the NBS, said at a press conference in Beijing.