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China scholar warns of social turmoil as growth slows

BEIJING (Reuters) - China risks massive social turmoil next year as the economy slows and the number of angry jobless grows, a leading Communist Party scholar has warned, urging the government to focus development priorities on job creation.

Zhou Tianyong, a researcher at the Central Party School in Beijing, forecasts the reservoir of poor, jobless workers and farmers will climb as nation’s growth rate slows to about 7.5 percent next year, its slowest rate for many years.

Writing in the China Economic Times on Thursday, Zhou warned that the resulting strains between rich and poor could erupt into searing unrest that will test the ruling Communist Party’s grip.

“The redistribution of wealth through theft and robbery could dramatically increase and menaces to social stability will grow,” he wrote in the Chinese-language newspaper issued by a state think tank. “This is extremely likely to create a reactive situation of mass-scale social turmoil.”

The Central Party School is the premier training ground for emerging leaders and Zhou has been an unusually outspoken advocate of political liberalization and equitable development.

His views do not reflect leadership policy. But they suggest real worry in elite circles about threats from flagging exports and spreading factory closures.

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China’s annual GDP growth slowed to 9.0 percent in the third quarter, from 10.1 percent in the second, and some forecasters see growth slowing to a dangerously low 7.5 percent next year.

In his survey of the country’s prospects, Zhou argued that the government’s artificially low count of urban unemployment -- about 4 percent now -- had deceived leaders into underestimating threats to social stability from slowed growth.

The real rate of urban joblessness grew to 12 percent this year, he estimated, warning it could climb to 14 percent next year.

China, he wrote, had been “bamboozled by the ‘wonderful’ situation of the fake urban unemployment rate.”

Reporting by Chris Buckley; Editing by Nick Macfie