China grew even faster in 2006 than previously thought. From AFP/CNA:
China has revised up its economic growth figure for 2006 to 11.1 percent from 10.7 percent, the National Bureau of Statistics said Wednesday.
Exports have been key to Chinese economic growth, with the trade surplus soaring.
China's trade surplus hit 26.91 billion dollars in June, a rise of 85.5 percent year-on-year and the highest monthly figure on record, official data showed Tuesday.
China says it will work harder to cut its trade surplus.
"We will continue to take measures to reduce the trade surplus and expand imports so as to realise more balanced trade," [commerce] ministry spokesman Wang Xinpei told reporters.
As it is, the trade surplus is pushing up China's forex reserves.
China's foreign exchange reserves, already the world's largest, surpassed 1.33 trillion dollars at the end of June, the central bank said Wednesday.
At 1.3326 trillion dollars, the reserves were up 41.6 percent from 12 months earlier, the People's Bank of China said in a statement on its website.
And, according to Bloomberg, its money supply.
China's money supply growth accelerated for the first time in four months, increasing the likelihood that interest rates will rise.
M2, the broadest measure, rose 17.1 percent in June from a year earlier to 37.8 trillion yuan ($5 trillion) after gaining 16.7 percent in May, the People's Bank of China said today on its Web site. It topped the government target for the fifth straight month and was higher than the 16.6 percent median estimate of 18 economists surveyed by Bloomberg News.
Foreign concerns over the quality and safety of Chinese products could have an effect on China's trade surplus in coming months, though. From AP/IHT:
First it was pet food that sickened dogs and cats. Then came warnings about toothpaste, toy trains, car tires and several types of fish.
The warnings had one thing in common — all of the products came from China. And that has people worried.
"I'm scared to death. We are dependent on our government inspecting things," said Joyce Simple, a church secretary, interviewed on a recent shopping trip to a Wal-Mart in Houston. "I would be careful of anything that came from China."
But the Chinese themselves probably need to be concerned too. Xinhua Online reports that public health incidents killed 224 people in the first six months in China.
The problem at least seems to be recognised in Jiangsu, where pollution threatened water supplies recently. Li Yuanchao, secretary of Jiangsu Provincial Committee of the Communist Party of China, has reportedly vowed to introduce measures to curb water pollution even at the risk of slowing economic growth.
Whether from a reluctance of foreigners to buy Chinese goods or from self-imposed restrictions, a slowdown in the growth of China's trade surplus would have ramifications for global liquidity and financial markets.