Beijing will try to offset the economic pain inflicted by rising crude oil prices by working to curb the development of energy-intensive industries, according to a senior economist. Lu Zhongyuan , head of the macroeconomic research department at the State Council's Development and Research Centre, said persistent increases in international crude oil prices would lead to a slowing down of mainland economic growth in the second half of this year, but the impact was expected to be limited. 'The central government will further introduce measures to curb investment in and development of high energy-consuming industries. And measures will be stepped up to overhaul old and inefficient heavy and chemical industries,' he said in Beijing yesterday. Mr Lu said the government would rely on economic measures to curb energy use, such as new taxes on energy and resource consumption, increasing the fuel and resources tax rates and reducing tax rebates for exports deemed resource-intensive. 'The government will become more determined to speed up the readjustment and restructuring of industry in its reaction to persistent price hikes and the shortage in energy supply,' he sad. Mr Lu said the central government was implementing a strategy to boost national economic development and security by encouraging energy conservation, and reducing consumption and dependence on imports. He said the growth of gross domestic product might slow by less than one percentage point if the international price of crude oil stayed above US$70 a barrel. 'Previously we forecast more than 9 per cent GDP growth in the second half of the year. And now I might adjust the growth to about 9 per cent,' he said. Mr Lu said the impact of crude oil price rises on the mainland economy was still limited because labour-intensive industries could absorb the shock thanks to an ample supply of cheap labour. 'So long as the economy can maintain an annual growth rate of 8 per cent to 9 per cent, the situation is acceptable and should be deemed healthy,' he said. Mr Lu denied the government's macroeconomic control measures were aimed at suppressing soaring property prices. 'What the central government wants is not to suppress property prices, but to bring their growth rate down to a reasonable level,' he said. Developers, property investors and buyers had all borrowed from banks for their investments and a bankrupt property market would lead to a banking crisis, Mr Lu said. He said the central government would take Hong Kong and Macau into 'very serious consideration' when it drafted the next five-year economic plan, but added that such integration must fall within the concept of 'one country, two systems'.