China's economy may grow 9.5 percent this year, down from 11.9 percent last year, a rate hurt mainly by the global financial crisis and natural disasters, an official with the Chinese Academy of Social Sciences said yesterday.

The biggest negative effect on the economy has been the global financial crisis which emerged in the second half of this year and has led to huge losses, said CASS economist Li Peilin who led a group reporting on China's social conditions for the year.

In his view, the post-Olympics settlement also had an effect but was not a major influence.

"The capital input of the Beijing Olympics from 2002 to 2007 was less than 1 percent of the national fixed asset investment in the same period ? Its influence over the whole nation was not as big as in other countries," Li said at a press conference in Beijing.

He said that Japan and South Korea, the two countries in Asia which had also staged the Olympics, both reported a retreat in economic growth after the event because of the huge capital injection.

Li said the disposable income of urban households would grow by around 7 percent this year from a year earlier while that of rural families could also expand by 7 percent.

But the forecast income growth was only half of the pace recorded last year and it would be the first time that urban households, whose incomes usually grew 4 or 5 percentage points faster than rural families, would post a similar expansion to rural areas.

Li expects declines in other key economic data for the year and said the only figure that could remain stable would be retail sales, which could settle at a gain of around 20 percent.

Looking ahead, Li said China's gross domestic product growth would continue to ease to 8 percent next year.

"We used to rely too much on exports to lift the economy. Growth in the export sector may plunge to a record low."

(Shanghai Daily December 16, 2008)