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China too reliant on export -economists
(Agencies)
Updated: 2005-06-02 20:58

BEIJING - China's economy has become too reliant on exports to fuel growth, and authorities should ease credit curbs somewhat to spur domestic demand, a top government think-tank said in a report published on Thursday.

The report by the State Information Center, carried in the Financial News, was the latest sign that influential Chinese economists are starting to worry about the country's ballooning trade surplus.

"If world economic growth or exchange rate policies change or undergo adjustment, the danger of a big drop in economic growth may increase," the newspaper quoted the report as saying.

China should "moderately reduce the degree of credit tightening to bring about sustained, appropriate and stable growth in domestic demand, allowing the economy to maintain its vigor," it quoted the report as recommending.

Worried that a handful of overheated industries could upset the country's overall economic health, Beijing has implemented a raft of credit curbs and other cooling measures since mid-2003. "The report suggests that official policy should aim to appropriately control the momentum of expanding external demand and increase the pace of expansion in domestic demand," the newspaper said.

The recommendation comes against a background of growing international unease over China's prowess in low-cost manufacturing, exemplified by curbs that the United States has imposed on Chinese textiles. The European Union is poised to slap on similar restrictions unless Beijing acts of its own accord.



 
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