BEIJING, Oct 17 (Reuters) - China will be able to sustain the momentum of its current V-shaped recovery, setting the stage for stronger growth next year than in 2009, Yao Jingyuan, chief economist of the National Bureau of Statistics, said on Saturday.
Figures due next Thursday are expected to show that annual gross domestic product growth accelerated to 8.9 percent last quarter from 7.9 percent in the April-June quarter, according to economists polled by Reuters.
“We can say with certainty that China’s economy is over the worst,” Yao told an economic forum. He identified November 2008 to February 2009 as the trough for the economy.
China’s leaders have consistently said it is too early to start retreating from the stimulative fiscal and monetary policies introduced a year ago to prop up demand.
Yao agreed, saying there was no case for adjusting macroeconomic policies based on distant prospects of inflation.
Whereas achieving full-year growth of 8 percent was the policy priority this year, the emphasis in 2010 would be on bringing about substantial structural changes in the economy, he said.
If China cannot tackle deep-seated imbalances in its economy, which have become more pronounced due to the global crisis, it would be vulnerable to repeated bouts of volatility, he added.
Among the problems facing the economy, Yao cited the fact that investment accounted for nearly 90 percent of GDP growth in the first half of the year; smaller firms were still labouring at a disadvantage; and the crisis had exposed overcapacity in industry.
Zhang Yuyan, head of the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, told the forum that, as the world economy pulls out of recession, China was coming under growing pressure to let the yuan resume its rise.
But China faced a dilemma, Zhang said. If it let the exchange rate appreciate too rapidly, exporters might suffer badly; but letting the yuan rise slowly would encourage an influx of speculative funds, he added. (Reporting by Aileen Wang and Alan Wheatley; Editing by Toby Chopra)