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Monday, January 11, 2016, 17:28

China in legitimate transition: IMF chief

By Xinhua

China in legitimate transition: IMF chief
This handout photo taken and released by the IMF on Jan 6, 2016 shows International Monetary Fund Managing Director Christine Lagarde speaking to members of parliament at the National Assembly in Abuja. (STEPHEN JAFFE / IMF / AFP)

YAOUNDE - The Director of the International Monetary Fund (IMF) Christine Lagarde said China's economic growth model was going through a legitimate transition.

Lagarde made the remarks in an interview with Xinhua over the weekend during her three day visit to Cameroon that began on Jan 7.

"The Chinese economy is going through a crucial and legitimate transition period, moving from very high levels of growth to more stable levels," Lagarde said.

Asked whether Africa should be concerned about the recent stagnation experienced in China, given that it was Africa's leading commercial partner, the IMF boss said there should be no anxiety in Africa.

"China will remain the second largest economy in the world after the US. Its economy will continue to grow next year, meaning that it will continue buying raw materials," she said, but noted that China may not reach growth levels of between 10 to 12 percent.

"China has consumed a lot of raw materials and ordered more materials from producing countries. These orders will reduce since the consumption of raw materials by the Chinese economy will equally reduce. Definitely, this will impact China's investment volume in producing countries, but this will not mean that China will not remain the biggest client for countries producing raw materials," she said.

With regard to China's recent readjustments of its economic policy, especially on exchange rate policy, Lagarde noted that given the transition China's economy is going through, some turbulence should be expected.

The IMF boss welcomed the recent announcement by Chinese President Xi Jinping that his country will give Africa US$60 billion in the next three years to support development projects.

"That one of the two largest economies in the world wants to work with the entire international community to create new partnerships and go beyond its natural geographic zone, is something that is welcome," she said.

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