Chinese Economy Soars

19 July 2006

BEIJING - China's economy surged 10.9% year-on-year in the first half of 2006, the National Bureau of Statistics has revealed, despite a slew of measures imposed by the government to ease investment growth.

Total GDP between January and June reached yuan 9.14 trillion ($1.14 trillion; €910bn; £498bn), says NBS spokesman Zheng Jingping.

Economists fear an overheated economy is producing excessive investment that could lead to industrial overcapacity, falling profits and a crash caused by mass bankruptcies.

Many local and foreign analysts expect China's authorities will be forced to raise bank interest rates for a second time this year and issue more aggressive instructions to banks to curb lending.