China’s economy expands 10.3 percent in 2010
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STEVE CHIOTAKIS: The Chinese president continues his American visit, with a trip to Chicago today. That’s on the heels of news that China’s economy expanded even faster than expected last year — 10.3. That’s more than three times the rate of growth here in the U.S. Yet Chinese officials are concerned the economy is growing too fast.
From Shanghai, the BBC’s Chris Hogg reports.
CHRIS HOGG: Here in Shanghai they’re stocking up in the supermarkets for the Chinese New Year, the biggest holiday of the year. One complaint you hear a lot from shoppers. Food’s more expensive than ever.
Officials admit rising prices are a problem. The government overshot its inflation target of 3 percent, and that’s taking the shine off the double digit economic growth achieved.
Economist Bill Adams from the Conference Board China Centre in Beijng says rising global commodity prices have helped fuel inflation, but…
BILL ADAMS: On top of that you also have very rapid economic growth and very loose credit conditions in China since the end of 2008 which have all contributed to higher inflation now.
The worry is that banks here are lending too much. Property developers are using that cash to build more and more homes and there are fears that a property price bubble’s building.
And if the bubble were to deflate, or worse yet, pop, the world’s second largest economy could put at risk the global economic recovery.
In Shanghai, I’m the BBC’s Chris Hogg for Marketplace.
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