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Stable economic growth to get priority
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The authorities look set to give priority to the country's stable economic growth in place of inflation control in the second half of the year, economists have said.

"It is a departure from the previous policies which aimed to prevent the economy from overheating and keep rising prices from evolving into entrenched inflation," said Zhang Jun, director of the China Center for Economic Studies at Fudan University, yesterday.

The forecast follows a central bank move over the weekend, which put stable and relatively swift economic growth as part of its top priority.

The central bank's position is in turn in line with that of the top leadership, which has said that the authorities should "treat maintaining stable but rapid economic growth and controlling excessive rises in prices as the top priorities in macroeconomic controls", Xinhua has reported.

Previous policies to prevent the economy from overheating and rein in inflation were set late last year, when the economy steamed ahead with an 11.9 percent annual growth rate.

That figure has cooled to 10.4 percent for the first half of this year, amid expectations of the slowdown worsening.

Financial giant UBS has reaffirmed its forecast of 10 percent GDP for the country this year, but lowered the forecast for 2009 from 9.5 percent to 8.8 percent.

"The Chinese economy is set to slide further," said Wang Tao, head of the China economic research unit of UBS, citing a weaker global outlook and slower export-related investment.

Wang also echoed Zhang's view, that the authorities are looking to give stable economic growth more weight.

"The government is now somewhat more concerned about a sharper economic slowdown than inflation," Wang said.

If that happened, she said, the authorities could allow room for local policy maneuvers to help re-orbit the economy onto a stable growth track, although an overall readjustment of the tight monetary policies would not be possible.

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