Economic growth in China could slip back into single-digit territory next year under the impact of a US slowdown, China's top planner said yesterday.
A cooling US economy will likely have a negative impact on Chinese exports while on the plus side, China will benefit from falling prices of oil and other raw materials, the National Development and Reform Commission said in a report.
"We believe that economic growth will drop below 10 percent in 2007," the commission said in its report, published in the China Securities Journal.
"Investment, industrial production and exports will all see a relatively obvious correction," it said.
China's economy, which expanded by 10.7 percent in the first three quarters, will likely grow 10.6 percent for all of this year, the commission said.
"As the US economy may see a rather significant correction, Chinese exports could see a fairly large impact," the commission said.
"But at the same time, a weakening of prices of oil and other raw materials will be beneficial for economic development," it said.
The forecast is in line with estimates for next year by major investment banks, which also predict single-digit growth next year, even after recent upgrades of their predictions for the world's fourth-largest economy.
Deutsche Bank has upgraded its forecast from the previous 8.9 percent to 9.5 percent, basing its revision on an "increasingly benign policy outlook as well as the healthy state of the economy."
JP Morgan raised its forecast for next year from 9 percent to 9.5 percent and said Chinese authorities would probably seek to further tighten liquidity, seeing a two-thirds chance of another interest rate hike before the New Year.
The commission also said China needed to pay more attention to interest rate tools in controlling economic growth, rather than adjustments to the yuan's exchange rate.
China can increase benchmark interest rates "at an appropriate time" next year, and should move to reduce expectations of a yuan appreciation, keeping the currency basically stable, it said.
But it added the introduction of some flexibility was warranted, including a widening of the yuan trading band.
Currently, the exchange rate is not allowed to move outside a 0.3 percent trading band around a parity rate set by the central bank at the start of every trading session.
The commission said that the government must implement macroeconomic measures more firmly.
Specifically, it needs to control new development projects, curbing excessive growth in fixed-asset investment and preventing rapid price rises in the property market.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”