Economic Growth and Social Unrest Forecast for China in '09

06 January 2009

BEIJING: The Chinese economy should meet the government's annual growth target of 8% this year, according to a survey of thirteen of the country's leading economists, but an increase in unemployment levels could also lead to growing levels of social unrest.

According to the survey, published in news agency Xinhua's magazine Outlook Weekly, the country's economic growth will slow in the first half of this year, before expanding at a much quicker rate in the second six months of 2009.

While the US demand for Chinese exports is set to drop, high savings rates, a secure banking system, strong domestic demand and the government's 4 trillion yuan ($586bn; €430bn; £404bn) stimulus package should help drive growth.

But some economists warn that these factors may be insufficient to prevent the negative consequences of the downturn having a broader impact.

Han Kang, vice-president of Beijing's National School of Administration, says: "Unemployment among university graduates and migrant workers, caused by the global economic downturn and the shrinking of export industries, will put much stress on Chinese society in 2009, even social risks."

Data sourced from People's Daily; additional content by WARC staff