China Premier Sees 11.5 Percent Growth

The Web site of the China Daily newspaper cited Wen as telling Chinese embassy staff, businessmen and foreign students in Singapore that the economy would stay on track as long as inflation was kept under control.

"A particular feature of the economy this year is that it has maintained steady, relatively fast growth," Wen said.

It is estimated that the economy will grow at a rate of 11.5 percent this year, the report cited Wen as saying.

If Wen's forecast is realized, 2007 would be the fifth straight year of double-digit growth and a slight rise over last year's revised growth figure of 11.1 percent. It is also in line with the 11.5 percent expansion in the third quarter this year compared with a year ago.

At the same time, the economy is wrestling with inflation, and economists complain that growth is heavily driven by investments in factories and other fixed assets and in high-flying real estate and stock markets.

Wen, in Singapore to attend the summit of the Association of Southeast Asian Nations, cited inflation as a pivotal issue, with consumer prices rising by 6.5 percent last month. China's food bill rose even faster, hitting 17 percent in October, with prices of the staple meat pork rising 58 percent during that period.

China needs to prevent fast growth from slipping out of control, Wen said.

China has ordered a series of measures this year to contain the torrid economy, including raising on no less than nine different occasions the amount of money commercial banks were required to keep on hand to try to control rapid lending. Along with reserve increases, the central bank has also been notching up deposit and lending rates -- with five hikes this year -- to further discourage loans.

Some government officials and economists worry that inflation could spill over into the wider economy and that hastily made loans could sour, saddling banks with higher debts.

Despite the moves, money is flooding into China, brought in by hugely successful export industries and by Chinese and foreigners hoping to cash in on the boisterous economy, the rising value of the currency and a stock market whose main index has increased six times in value in two years.