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Last Updated: Tuesday, 2 December, 2003, 07:05 GMT
China plans to ease rapid growth
Chinese yuan
China is set to touch the brakes in 2004, taking the edge off wildfire growth, according to state media.

Next year's economic expansion target will be 7%, the People's Daily said economic planners had decided.

The most recent quarterly figures showed China's economy swelling at 9% a year, with 7.7% the average since 1998.

The paper said Premier Wen Jiabao had told planners that growth was not the be all and end all, and that social development should also be a priority.

"Co-ordinated development" was the key, he reportedly said in a meeting of the National Development and Reform Commission, hinting at a more balanced approach than the breakneck rush for expansion of recent years.

Imbalance

The rapid growth has widened gaps between a burgeoning middle class and the urban and rural poor, and China's rulers are worried about the possible fall-out.

At the same time, rampant investment - up a third this year - in sectors such as steel, cars and cement are straining the electricity network.

Sizzling sectors of the economy such as luxury housing are being hit with lending curbs to try to stem activity.

Meanwhile, the US is continuing to raise its voice about what it sees as an unfairly low exchange rate for the Chinese yuan.

The White House says American jobs are being lost to unnaturally cheap Chinese exports.

China has said it will move from its current peg to a freely floating currency, but hints it will not happen for some years.


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