China said today that its economy grew by 10.3% in 2010, marking the fastest annual pace since the onset of the financial crisis and underlining the country's growing might.
Gross domestic product in China rose at an annual rate of 9.8% in the fourth quarter, accelerating from the previous quarter and exceeding analysts' expectations, while consumer inflation eased in December as Beijing moved to rein in prices.
The 2010 GDP figure, up from a revised 9.2% growth in 2009, highlighted China's powerful performance in a year when it overtook Japan to become the world's second-largest economy behind the US.
The result is slightly better than the forecast of the World Bank, which has predicted 10% annual growth.
'Currently the economy is in a critical period of transforming from recovery to stable growth,' Ma Jiantang, Commissioner of the National Bureau of Statistics, said. Ma said China would step up efforts to transform the country's 'economic growth pattern' - referring to Beijing's aim to boost domestic consumption and reduce its reliance on exports and investment.
His comments were similar to those of President Hu Jintao, who told US business leaders during a high-profile visit to Washington yesterday that China would boost interior demand and consumer spending.
The country's consumer price index, the main gauge of inflation, rose by 4.6% year-on-year in December compared with 5.1% in November, which was the fastest pace in more than two years. The index rose 3.3% for all of 2010 - exceeding the government's full-year target of 3% as food costs soared.
Analysts said the pick-up in growth in the fourth quarter - partly driven by stronger exports - and the still-high inflation figure in December supported the case for further interest rate hikes and bank lending curbs.
The value of Chinese exports reached $1.578 trillion in 2010, up 31.3% after hitting a record high for a single month in December. Output from the country's millions of factories and workshops rose 15.7% for all of 2010, faster than in 2009 as manufacturers cranked up activity to meet growing demand for Chinese-made goods.
Urban fixed asset investment, a measure of government spending on infrastructure, rose 24.5% over the 12 months - slower than in the previous year as Beijing started to wind back crisis-driven stimulus measures. Retail sales, a key indicator of consumer spending, rose 18.4% in 2010.
As the US and Europe struggle to spur growth, Beijing has been trying to slow its economy and stem a flood of liquidity that is fanning inflation and driving up property prices, straining household budgets.
The central bank last Friday again ordered banks to increase the amount of money they keep in reserve, effectively putting a cap on lending, after raising interest rates twice in the fourth quarter.
