China's gross domestic product grew by 8.9 per cent in April from a year earlier, reported China Securities Journal. The rate reported for last year was 8 per cent, rising to 9.9 per cent in the first quarter of this year.
The unusual decision by the government to announce a monthly economic growth figure was intended to boost confidence hit by the outbreak of Sars (severe acute respiratory syndrome). Retail sales for the month grew by a relatively modest 7.7 per cent, as consumers stayed away from shops and restaurants.
Yuan Gangming, an economist at the Chinese Academy of Social Sciences, said the data were disappointing. "I expect May GDP to be even worse, say, at most 8 per cent," he said. "Now the biggest threat to the economy is not Sars, but incorrect policy adjustment."
Other economists have cut their forecasts for economic growth this year as a result of the impact of the spread of Sars. Beijing University Economic Research Centre has estimated that the disease could reduce GDP by Yn10bn, about 2 per cent of last year's GDP, damping full year growth to 6-7 per cent. Goldman Sachs predicted that the economy would grow by 6 per cent this year, while HSBC cut its forecast from 7.2 per cent to 7 per cent, on the assumption that Sars subsides by the end of July.