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Economy in Brief

China's Real GDP Continues to Slow
by Louise Curley October 20, 2008

China's real Gross Domestic Product in the third quarter of this year, just released, was 9% over the third quarter of last year.  The increase was below consensus and was the fifth quarter in a row in which the rate of increase declined, as can be seen in the first chart.  Last year China's economy grew by 11.6%.  So far this year the economy is growing 9.9% over the corresponding period of  2007.  With the outlook for continued slowing of the economy, the growth for this year as a whole is unlikely to be that high.  

The only sector to show growth increasing this year is the primary sector that includes farming, forestry, animal husbandry and fishing.  This is the smallest sector of the economy and the one with the lowest growth rate.  The secondary sector that includes mining and quarrying, manufacturing, production and supply of electricity, water and gas, is the largest sector and has experienced the sharpest deceleration in growth in the economy in the current year .  

The tertiary sector that includes all industries not included in the primary or secondary sectors, experienced a slightly smaller deceleration in growth.  The second chart shows the year to date growth in the total economy and in the three sectors.  The third chart shows the relative magnitudes of the three sectors in  nominal terms (billions of yuan).

CHINA   Q3 08 Q2  08  Q1  08  2007 2006 2005
GDP Y/Y % Change 9.0 10.1 10.6 11.6 10.7 9.9
GDP (YTD %) 9.9 10.4 10.6 11.9* 11.6* 10.4*
  Primary Industry  (YTD %) 4.5 3.5 2.8 3.7* 5.0* 5.2*
  Secondary Industry (YTD %)    10.5 11.3 11.5 13.4* 13.0* 11.7*
  Tertiary Industry (YTD %) 10.3 10.5 10.9 12.6* 12.1* 10.5*
  Primary Industry  (Billion Yuan) -- -- -- 2891 2470 2272
  Secondary Industry (Billion Yuan) -- -- -- 12138 10200 8621
  Tertiary Industry (Billion Yuan) -- -- -- 9633 8270 7340
*These are Q4 to Q4 changes.
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