China's Xi confident of 'healthy' economic growth

[WASHINGTON] Chinese President Xi Jinping said on Friday he was confident that his country would post "healthy" growth in the future, amid international worries about a slowdown in the world's second-largest economy.

Mr Xi told a joint press conference with US President Barack Obama after White House talks that China had moved from "speed-based growth to quality-based growth." Chinese authorities are trying to rebalance the economy - which accounts for one out of every eight dollars of worldwide GDP - from one reliant on exports and heavy government investment in infrastructure to one where domestic consumption is the main driver.

But alarm bells have been rung over how rapidly the economy is slowing, and whether the so-called new one is expanding fast enough to take up the slack.

Mr Xi nevertheless insisted the outlook was solid.

"We call this the new normal of the Chinese economy and I'm confident going forward China will... provide a healthy growth that strengthens confidence," he said.

The Chinese leader did acknowledge that his country was under "increasing pressure" of an economic downturn and "some fluctuations on the stock market." "Challenges and difficulties have obviously increased," he said.

China's economy expanded 7.3 per cent last year, the weakest pace since 1990, and slowed further to 7.0 per cent in each of the first two quarters this year.

Xi said Friday he expected growth for 2015 to remain at about seven per cent.

But the Asian Development Bank cut its growth forecast for China to 6.8 per cent for this year, instead of the 7.2 previously estimated, following a stream of weak indicators including on trade, inflation, investment and consumer spending.

The government in Beijing has cut interest rates five times since November as part of frantic efforts to shore up growth. They also have reduced bank reserve requirements to spur lending.

Investors have been concerned about China's shock devaluation last month of the yuan currency.

And China has struggled to restore confidence in its markets, intervening on a broad scale amid months of declines that began in June and roiled exchanges worldwide.

AFP