Hong Kong: China's economy is expected to grow 9.6 per cent in 2011 as fixed asset investment remains a key driver, the Asian Development Bank (ADB) said in a report released in Hong Kong on Wednesday.
With inflationary pressures building and a tightened monetary policy, China's GDP growth was forecast moderate this year, compared with a growth of 10.3 per cent in 2010, said the ADB in its 2011 Asian Development Outlook, which expected a growth of 9.2 per cent in 2012.
The inflation rate, which averaged 3.3 per cent in 2010, will pick up to 4.6 per cent in 2011, lifted by abundant liquidity and higher food and commodities prices, the ADB said.
The bank estimated the inflation will ease back to 4.2 per cent in 2012 as commodity prices level off, Xinhua reported.
Fixed asset investment will remain a key driver of growth, although the expansion rate is set to decelerate slightly from past levels, standing at 22 percent in 2011 and 20 per cent in 2012, respectively, due to the winding back of fiscal stimulus measures and tighter monetary policy, the bank said.
The new five-year plan, starting from 2011, will put more emphasis on consumption and services as drivers of growth, said the Manila-based bank.
The bank's forecast growth for developing Asia, comprising of 45 economies in the region excluding Japan, has been at 7.8 per cent in 2011, with an inflation rate of 5.3 per cent.