Business

Published: Tuesday July 21, 2009 MYT 2:11:00 PM

Growth slumps in Chinese boomtown Dongguan


DONGGUAN, China The southern Chinese boomtown of Dongguan posted economic growth of 0.6 percent in the first half - far off the pace of the 10 percent target for the year, a state-run newspaper reported Tuesday.

The dismal growth figure marked a spectacular slowdown for Dongguan, which averaged about 20 percent annual economic growth since 1980 as it fed global demand for everything from toys and shoes to mobile phones and computers.

The city near Hong Kong in the Pearl River Delta is often called "the world's factory floor."

The Southern Metropolis Daily, one of the region's most popular papers, on Tuesday quoted the city's mayor, Li Yuquan, as saying the disappointing first-half figure will make it difficult to hit the goal of 10 percent growth for the year.

The paper also quoted finance professor Lin Jiang at the prestigious Zhongshan University as saying that Dongguan will need a miracle to reach its 10 percent growth target.

Dongguan's export-oriented economy has been hit hard by the global recession. But even before the downturn, the city's manufacturers were suffering because of rising costs of raw material and labor along with currency fluctuations.

Massive waves of factory closures have been reported as investors from Taiwan, Hong Kong and other places shut down.

The National Bureau of Statistics announced last week that the economy for the whole country grew by 7.9 percent in the second quarter from a year earlier, though Beijing cautioned that a full-fledged recovery is not firmly established.

That follows growth of 6.1 percent in the first quarter, and analysts said full-year growth for the country should easily reach the government's 8 percent target. - AP


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