Economic growth in China fell slightly in the first quarter of the year despite concerns about a global economic downturn. At the same time, inflation remains a problem for the country. Jamila Trindle reports from Beijing.
Government figures released Wednesday show gross domestic product in the first three months of this year grew by 10.6 percent, down from just over 11 percent a year ago.
A spokesman for the National Bureau of Statistics, Li Xiaochao says growth remains "fast and steady."
He says that economic performance this year, generally speaking, is very good and has kept the momentum of fast growth. He also says this was achieved despite difficulties, both domestic and international ones.
China was hit with snowstorms earlier this year that halted transportation for days and ruined crops. Li says, internationally, China is concerned about the risk the sub-prime mortgage crisis in the United States could slow the global economy.
China also faces inflation. Consumer prices rose more than eight percent in March over the same month last year. The inflation rate remains near a 12-year high.
Li says the price increases that started in 2007 are mainly due to much higher food prices, and it is still the same this year. He says the government plans to boost farm production, focusing particularly on grain and pork output.
Government leaders have pledged to control inflation. In the past, rapidly rising food prices sparked huge public protests, which China wants to avoid ahead of the Summer Olympics in Beijing in August.
In an effort to help contain growth and slow inflation, the People's Bank of China Wednesday evening ordered banks to hold cash reserves equal to 16 percent of deposits. That is an increase of half a percentage point and effectively pulls billions of dollars out of circulation.
The spokesman says China's total econo mic output in the January to March period was 880 billion dollars, bringing China closer to overtaking Germany as the world's third largest economy.