Beijing  - The expansion of the Chinese economy slowed to a record low in the first three months of 2009, falling to 6.1 per cent from the same quarter a year earlier, but the growth rate was "better than expected," an official said Thursday.

   China's gross domestic product (GDP) was 6.57 trillion yuan (939 billion dollars) for the quarter. The growth rate was 4.5 percentage points lower than in the same period last year and the lowest since the start of quarterly records in 1992. It also fell from 6.8 per cent in the fourth quarter.

   The first-quarter performance was "better than expected" in view of the global economic crisis hitting the economy harder than previously thought, said Li Xiaochao, a spokesman for the National Bureau of Statistics.

   Growth was dragged down by a sharp drop in exports, but the drop was buffered by the Chinese government's 4-trillion-yuan stimulus package, the bureau said.

   Prime Minister Wen Jiabao said the statistics showed that his government's recent economic policies were "timely, powerful and effective" as he hailed rises in investment, consumption and industrial output as well as abundant liquidity in the banking system as signs of positive economic changes in China.

   But initial expert reaction warned against excessive optimism. "The economic outlook is still bad," Wang Tongsan, an economist at Beijing's Academy of Social Sciences, was quoted as saying by the official Xinhua news agency.

   The world's third-largest economy after the United States and Japan is suffering from a big drop in exports, declining company profits and tax revenues, and growing unemployment, Li said.

   First-quarter exports were down 19.7 per cent from a year ago to 245.5 billion dollars while imports declined 30.9 per cent to 183.2 billion dollars. Foreign trade dropped 24.9 per cent to 428.7 billion dollars.

   Industrial output was up 5.1 per cent in March compared with March 2008 and 8.3 per cent from February, Li said.

   Consumer prices fell by 1.6 per cent year-on-year in February and logged a 1.2-per-cent drop in March, he added. Retail sales for the first quarter were up 15 per cent to 2.94 trillion yuan.

   Fixed asset investment in the first quarter rose by 28.8 per cent to 2.81 trillion yen. Li said he expected investments to keep growing.

   China's first-quarter growth was triggered mainly by investments stemming from the government stimulus package and a strong increase in loans.

   China's GDP grew by 13 per cent in 2007 and by 9 per cent in 2008. Independent experts said they doubted the government's 8-per-cent growth target for 2009 could be achieved.

   "I expect that the first half of the year will be low as the numbers indicate the economy will bottom out and there will be a modest recovery in the second half," said Ben Simpfendorfer of the Royal Bank of Scotland.

   Simpfendorfer revised upwards his growth forecast for 2009 from 5 per cent to 7 per cent but warned that the recovery would be weaker than generally predicted.