China Economy 2018: Chinese Academy of Sciences predicts a 6.7% annual growth

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The Chinese Academy of Sciences released its annual economic forecast for 2018. The report says the Chinese economy will continue to grow at a steady and relatively high speed this year. And consumption will become a key force in driving growth. Let's take a close look.

The report predicts a diminishing speed for China's economic growth this year. The annual growth rate is estimated at 6.7 percent.

CHEN XIKANG, RESEARCHER CHINESE ACADEMY OF SCIENCES "The growth rate is quite impressive. That's higher than high-income countries as well as mid-income countries. China's economy has achieved uninterrupted growth for the past 30 years. It's impressive that it still maintains 6 to 7 percent growth."

With a growing weight in the economy, consumption will play an even bigger role in driving growth going forward. The Chinese Academy of Sciences estimates that consumption will contribute 4.5 percent to growth. That's compared to 2 percent from investment and 0.2 percent from exports.

WANG SHOUYANG, RESEARCHER CHINESE ACADEMY OF SCIENCES "We expect more quality rather than quantity from investments. Consumption's contribution to GDP growth is growing at a quick pace. What's surprising is that net export will continue to grow in 2018."

The report also forecasts a mild growth in consumer inflation at 1.9 percent. The consumer price increase will peak in the middle of the year. On the external side, the report expects major central banks to tighten monetary policies further and that oil prices are likely to average at 60 US dollar per dollar.