According to the latest revised data* by 2 July 2010, China GDP in 2009 was RMB 34 trillion, around 10.3% came from the primary sector (extraction of natural resources), 46.3% came from the secondary sector (processing of primary products) and the remaining 43.4% came from the tertiary sector (services of various kinds for production and consumption).
In 2010 Q2, China GDP for the second quarter was USD 1.337 trillion, surpassed Japan's USD 1.288 trillion to become the world's second largest economy.
Our independent economic expert team put estimated fair values of 2011 final goods and services produced within China (N.B.: imports of goods and services are deducted) into the GDP formula, by our calculations, the domestic GDP will climb up by +8% in 2011. This calculated target indicates we basically assume a slower growth rate in 2011 than that in 2010.
The main reasons are:
- it is our prediction that the global economy will slow down in 2011.
- on 18 October 2010, the Chinese government finalized the directions for its latest 12th 5-year plan (also called "Twelve Five-Year Plan") and has showed no intention to abandon +8% as the minimum annual GDP growth rate in China.
Although we target for a 2011 slower growth in China, an annual GDP (Gross Domestic Product) growth rate at +8% should still represent a reasonably high level of economic growth in any single country across the world. Even though China is a really big developing country, one should not necessarily expect its GDP must climb up over +10% every single year. A reasonably high economic growth is good, but too high and rapid growth every year can be unsustainable and can result in many uncontrolled drawbacks such as never-ending high inflation. We would rather believe that Chinese central government should prefer a healthy and real GDP growth that can be sustainable.
On the other hand, an annual GDP growth less than +8% in 2011 can be something similar to a disaster for China. Since China GDP had a relatively fast growth of +10.3% YoY in 2010, any economic growth less than +8% a year later in 2011 can represent a real sharp fall. Such situation, if it should occur, will become too difficult to recover and thus should not be acceptable to the Chinese central government at all.
The +8% is of course our initial release value of China GDP growth rate target in 2011, it may be upgraded/downgraded later if the related domestic or global economic conditions may change.
Last but not least, we do not consider to just set our 2010 target, simply because this year is going to be over soon. We will, however, continue to release our other 2011 economic targets for China to our readers, in addition to this GDP (Gross Domestic Product) target.
UPDATE - Next article: 2012 GDP Target
2011 CPI target
2011 Trade Balance target
2011 Shanghai SSE Composite Index target
2011 Hong Kong Hang Seng Index target
Setting our own targets