Can China be the 2nd largest economy?
The Chinese
economy grew by stunning 10.7% in the fourth quarter of 2009, which may see it
replacing Japan as the second largest economy in the world. Bolstered by massive stimulus
measures and improving domestic output, China clocked an economic growth rate
of 8.7% in 2009, even as many developed nations are still grappling with
recession blues.
The National Bureau of Statistics of China on
Thursday said the national economy grew 10.7% in the December quarter, much
higher than 2009 third quarter expansion of 9.1%. "The
gross domestic product (GDP) for the year 2009 was 33,535.3 billion yuan (about
$4.91 trillion), up by 8.7% at comparable prices..., " National Bureau of
Statistics' Commissioner Ma Jiantang said in a statement.
Bogged down by the financial meltdown, Japan has
seen sluggish growth in recent quarters. World Bank has projected that the
Japanese economy would shrink 5.4% in 2009, which implies that its GDP would
come down to $4.66 trillion.
"In terms of growth by quarters, it was up
6.2% for the first quarter, 7.9% growth for the second quarter, 9.1% for the
third quarter and 10.7% for the last quarter (of 2009)," the statement
noted. China, one of the fastest growing economies, had
resorted to proactive fiscal policy and relatively eased monetary steps to keep
the growth momentum .
However, the latest economic figures have also
raised concerns that China may tighten the money supply in the coming months to
avert the economy from overheating. Earlier this month, the Chinese central bank raised the
cash reserve requirements of its banks by 50 basis points.
World Bank has forecast global economy to expand
2.7% 2010 while it expects Chinese GDP to grow as much as 9% this year. Recently,
the International Monetary Fund said that world economy is recovering than
expected and is anticipated to climb over 3% in 2010.
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