China revises 2007 GDP growth up to 11.9 pct

By Simon Rabinovitch and Zhou Xin

BEIJING (Reuters) - China on Thursday revised up its GDP growth for 2007 to 11.9 percent from 11.4 percent, showing that the world's fastest-growing major economy had even more of a banner year than initially thought.

Gross domestic product expanded last year at the quickest pace since 1994 and, but for a strengthening of the euro, would probably have moved China clear of Germany as the world's third-biggest economy when expressed in dollar terms.

The statistics agency also revised up 2006 GDP growth to 11.6 percent from 11.1 percent.

The upward revisions reflected greater output in the service sector than was initially reported, data on the National Bureau of Statistics (NBS) Web site showed.

With many analysts forecasting weaker growth this year, the GDP restatement provided a timely reminder that China has a habit of delivering unexpectedly strong economic performances.

Tim Condon, head of Asia research at ING in Singapore, said he was a little sceptical of the slowdown story. "China may once again surprise on the upside," he said.

"Domestic demand is fully capable of offsetting the foreign demand component that may slow down because of the narrowing trade surplus and keep that growth rate pretty high," he said.

As China's economy goes from strength to strength, so does its currency. The yuan <CNY=CFXS> punched through the symbolic barrier of 7 to the dollar on Thursday for the first time since Beijing scrapped its peg to the U.S. currency in July 2005 [nSHA132461].