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Chinese Economy Heading For Collapse: Former Clinton Advisor
China's economy faces a "collapse" over the next decade owing to a high savings rate and over-investment in industrial capacity, a former economic advisor to former US president Bill Clinton said on Monday. "At this moment China is saving too much and is investing too much in factories which the world does not need. Like this it is certainly heading for a great fall, a collapse," former advisor Robert Wescott told the Portuguese business daily Jornal de Negocios. "It could be in 2007, maybe in 2014, I don't know. But what I know for sure is that China will have over the next ten years a great fall in economic activity," he added. Wescott was in Lisbon last week to take part in a meeting of top economists. China's economy grew 9.4 percent in the third quarter of 2005 compared with a year earlier, underpinned by investment-led export growth, official data showed Thursday. The country's economy expanded 9.5 percent in 2003 and 2004. The government has sought to slow growth to more sustainable rates, arguing surging growth could ignite inflation that would hurt the country's fragile banking system. The government has also expressed concern that runaway demand for oil and other resources is putting a strain on transportation systems while too much investment in property developments could lead to financial problems. All rights reserved. � 2005 Agence France-Presse. Sections of the information displayed on this page (dispatches, photographs, logos) are protected by intellectual property rights owned by Agence France-Presse. As a consequence, you may not copy, reproduce, modify, transmit, publish, display or in any way commercially exploit any of the content of this section without the prior written consent of Agence France-Presse. Related Links TerraDaily Search TerraDaily Subscribe To TerraDaily Express China Unveils Broad Blueprint Aimed At Righting Growth Imbalances Shanghai (AFP) Oct 19, 2005 China's ruling Communist Party Wednesday outlined a vague economic blueprint aimed at rebalancing an economy which has promoted 25 years of miraculous growth but engendered a massive wealth gap.
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