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Last Updated: Thursday, 17 July, 2003, 06:14 GMT 07:14 UK
Chinese growth slackens after Sars
Chinese car workers
Chinese industry has avoided ill-effects
China's growth has slowed from the power-house performance of the first few months of 2003, as the impact of the Sars respiratory virus hit home.

The expansion over the second quarter - equivalent to 6.3% growth over a full year - in the massive mainland economy is the lowest for the April-June period since 1992.

But after a breakneck 9.9% expansion in the first quarter of the year, the figure for the first half of 2003 is 8.2%, well ahead of expectations and enviable by most countries' standards.

The after-effects of the Sars virus, which devastated travel and trade across Asia, were evident in the services sector, which grew just 0.8%.

The Chinese government had rejected warnings of Sars' impact till late April, sparking criticism that it had unnecessarily hindered efforts to control the virus's effects.

Before the announcement earlier this month that China was finally Sars-free, the epidemic killed more than 340 people and infected more than 5,300.

The belated announcement saw much of the country grind to a near-standstill, with the number of people travelling down by almost a quarter.

"After entering April, because of the impact of Sars, some industries were severally affected leading to a clear slowdown in economy growth," National Bureau of Statistics chief economist Yao Jingyuan said in a statement.

The government is counting on continued growth to feed the demand for jobs in China as more and more workers are pushed out of work in market-oriented reforms.

But although exports are up a third and imports up 45%, retail sales are still weak, causing some to fear the economy could overheat.

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20 May 03  |  Business

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