The IMF has projected 7.75 per cent growth for China this year, lower than last year's 7.8 per cent, bellying expectations of rebound of the world's second largest economy.
The Chinese economy is expected to grow at around 7.75 per cent this year and at about the same pace next year, the IMF's first deputy managing director David Lipton told media here today.
Explaining the reasons for slow growth, he said although progress has been made in external rebalancing, China's growth is still too dependent on investment, particularly in the property sector and by local governments, he said.
Chinese export growth has been, after years and years of very rapid growth, very slow because of the state of the global economy and the IMF took into considerations the projections of the global economy into effect for China's growth prospects, he said.
To accelerate the growth, the IMF has called for slower growth in social financing and a relaxation of controls on interest rates and the exchange rate.
Notwithstanding the cut in growth projections, Lipton "Let's not lose sight of the fact that China is still growing at a very fast rate. We're projecting that growth will remain robust."
This despite weak and uncertain global conditions, he said.
Economic growth should pick up moderately in the second half of the year after credit expansion gains traction, Lipton said, adding that the prediction is in line with an expected mild pick-up in the global economy.
The slow growth continue to affect the Chinese economy knows for its double digit growth rates in the not so distant past emerging as world factory.
In the last three years the growth fell from over 11 percent to 7.8 per cent last year, which was the lowest in 13 years.
Chinese economists say that per cent of growth lost reflected in losses of millions of jobs. The economy grew 7.7 in the first quarter.
Inflation is expected to hit 3 per cent around the end of the year, while the external current account surplus is expected to remain around 2. 5 per cent of the GDP, Lipton said.
