Beijing, China (4E) – Chinese economic growth is expected to slow down this year, amid increasing challenges that put more risk to the country’s traditional growth model of investment-led spending, according to the official Xinhua News Agency citing a report by the State Council.
China’s gross domestic product (GDP) is likely to be at 7.6 percent this year, slightly lower compared than 7.7 percent in 2012, according to the State Council report released Wednesday.
The GDP data came as the People’s Bank of China moves to ease a liquidity crunch in the market for inter-bank loans, after the second spike in borrowing costs this year caused some panic in the financial markets.
China’s five-year plan predicts an annual GDP growth of 7 percent from 2011 to 2015. The economy grew 9.3 percent in 2011, 7.7 percent in 2012 and 7.6 percent in the first six months of this year, the report showed.
Chinsese President Xi Jinping is seeking to strengthen the role of the private sector and domestic demand in an economy heavily dependent on debt-funded public investment in recent years. The service sector accounted for 44.6 percent of GDP last year, up from 43.2 percent in 2010 and compared with the 47 percent goal for 2015, the Xinhua report said.