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Last Updated: Tuesday, 18 July 2006, 09:15 GMT 10:15 UK
China says growth 'under control'
Yuan
China's trade surplus continues to grow
China's economy grew 10.9% in the first half of 2006 against the same period a year ago - but moves to cool growth are starting to work, the government says.

Official figures showed that exports climbed by 25.8% compared with the same period in 2005 to $428.6bn (235bn).

Measures have been put in place to rein in credit and construction to ensure that growth remains sustainable.

And the government has announced new plans to make it tougher for foreigners to invest in China's property market.

"We believe the economic growth rate at the current stage is reasonable," said a spokesman for China's National Statistics Bureau, Zheng Jingping.

Inflation warning

The data showed that in the second quarter of 2006, the economy grew by 11.3% compared with the same period last year.

Meanwhile the consumer price index - used as the main measure of inflation - rose by 1.3% in the first six months of the year

China's imports in the first half of the year grew to $367.1bn - a 21.3% rise.

This creates a trade surplus of $61.5bn for the period - including $14.5bn for June alone - which may add weight to calls for China to raise the value of the yuan.

Critics in the US have argued that Beijing keeps the yuan artificially low, which China denies.

In new rules being introduced, foreign firms and individuals are to be banned from buying homes that they do not intend to live in.

They must have lived in China for at least a year before qualifying to buy housing and property under their own name.

"Though there has always been a claim that foreign capital pushes up prices, both the government and research department lacked detailed data on this so the name register will give a clearer picture," said China Merchants Securities analyst, Yu Zhiyong.

China has already banned the building of luxury homes on new land to make affordable property available to poorer families and its central bank is tightening scrutiny on lending to limit "excessive investment and loans growth".

It has warned that heavy construction spending could lead to inflation and cause problems for financial institutions if builders fall behind on repayments.




SEE ALSO
China to stem 'excessive' credit
19 Jun 06 |  Business
China in luxury homes crackdown
01 Jun 06 |  Business
China trade surplus at fresh high
12 Jun 06 |  Business
China set to be largest economy
22 May 06 |  Business
What is America's China problem?
20 Apr 06 |  Business

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