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          China's legislature endorses economic plan
          (AP)
          Updated: 2006-03-14 18:19

          China's legislature on Tuesday endorsed a government plan calling for lower-than-expected 8 percent economic growth in 2006, while Premier Wen Jiabao rebuffed speculation over further currency adjustments.

          On the last day of its session, the National People's Congress approved a five-year blueprint for the world's six largest economy that included the forecast — a sharp drop from the 9.9 percent the economy grew last year.

          The government expects growth to level out at an annual average of 7.5 percent for the next five years "on the basis of reduced energy consumption and pollution discharge," the Xinhua News Agency said.

          Chinese leaders are insisting they will slow growth this time as they seek to curb waste of energy and other resources and close down heavily polluting factories.

          "It is true that we are facing a very serious problem with environmental pollution," Wen said. "We have failed to deliver on the targets concerning environmental protection."

          It's unclear how the push to improve efficiency and environmental protection would dampen growth, since spending on better pollution controls could actually boost business activity, says Stephen Green, senior economist at Standard Chartered Bank in Shanghai.

          However, slowing export growth and less lavish investment by companies pinched by high prices for crude oil and other resources will inevitably have an impact.

          "Most of all, they'd like to control the overall quality of growth, not to slow it down," Green says.

          Still, the World Bank and other analysts have projected economic growth at above 9 percent this year.
          Page: 12



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