According to the national statistics
bureau, the figures pointed to a “complex environment” both at home
and abroad.
It said the country’s economy had
“performed within the reasonable range” in the first half of 2019 but
that it faced “new downward pressure”.
While China watchers advise caution
with Beijing’s official gross domestic product numbers, the data is seen as a
useful indicator of the country’s growth trajectory.
Other data showed some signs of
improvement in the world’s second largest economy.
Industrial production rose 6.3% in
June from a year earlier, while retail sales rose 9.8% year-on-year – both
above forecasts in Reuters polls.
Slowing growth in China has raised
concerns about the potential knock-on effect on the global economy.
Earlier this year China announced
plans to boost spending and cut billions of dollars in taxes in an effort to
support the economy.
It has also moved to provide a
liquidity boost by reducing the amount of cash banks must hold in reserve.
The US-led trade war is another
factor weighing on growth.
While the US and China agreed to resume trade talks at a recent G20 summit
in Japan, they have already placed tariffs on billions of dollars worth of one
another’s goods, hurting businesses and casting a shadow over the world
economy.
According to official data, China’s economy grew by 6.9% in 2017 – the first time in seven years the pace of growth has picked up.
The figure beats the government’s official annual expansion target of about 6.5%.
China is a key driver of the global economy and so the better-than-expected data is likely to cheer investors around the world.
However, many China watchers believe the GDP numbers are much weaker than the official figures suggest.
This month alone, the governments of Inner Mongolia and of the large industrial city of Tianjin have admitted their economic numbers for 2016 were overstated.
Taking the figures at face value, the 2017 growth rate is China’s highest in two years and it represents the first time the economy has expanded faster than the previous year since 2010.
However, as Beijing ramps up efforts to reduce risky debt and to increase air quality, analysts said this may impact 2018 growth.
The numbers released on January 18 also showed that in O4 of 2017, the economy grew at an annual rate of 6.8% – slightly higher than analysts had been expecting.
The country’s debt has risen significantly in recent years, with worrying numbers around local government loans, corporate and household debt and non-performing bank loans.
The International Monetary Fund (IMF) said recently that China’s debt had ballooned and was now equivalent to 234% of the total output. It said China needed to concentrate less on growth and instead help improve banks’ finances, among other efforts.
Meanwhile, the Chinese government says it has been taking steps to contain risky debt despite the impact that might have on economic growth – efforts the IMF said it recognized.
The government has promised to continue tackling local government debt, among other efforts, and on January 18 vowed to help state-owned enterprises “leverage and cut debt … and to repay their bonds on time this year”.
China’s strict anti-pollution measures, which were introduced across 28 cities in 2017, are also expected to hurt economic growth in the short term.
The measures have included shutting down or cutting back production at factories in heavy industry like cement and steel.
Households have also been asked to switch to natural gas and electricity from coal, in an effort to curb pollution.
However, this policy left millions without proper heating, and so was temporarily abandoned in December.
According to officials, Beijing’s air quality improved sharply in the winter of 2017. They also heralded their efforts as a “new reality” for China.
Li Keqiang said he would tackle state “zombie enterprises” producing more coal and steel than the market needed.
Similar pledges in the past have proved hard to fulfill.
More than 3,000 legislators are meeting in the Great Hall of the People.
The NPC and its advisory body hold ceremonial meetings every year known as “lianghui” or “two sessions”.
Image source Flickr
PM Li Keqiang described the world’s second-largest economy as a butterfly struggling to emerge from a chrysalis.
The premier said this transformation was filled with promise but also great pain.
Li Keqiang repeatedly paid tribute to Communist Party leader Xi Jinping and said that under the sound leadership of the Party, the Chinese people had the courage and ingenuity to overcome all difficulties.
His list of China’s difficulties ranged from the smog which blankets much of the country to the laziness of some government officials.
In a veiled reference to President Donald Trump’s complaints about China’s exchange rate and trade policies, PM Li Keqiang warned of a far more complicated global picture in the year ahead with China facing the threat of growing protectionism.
NPC leaders are tolerating slightly slower economic growth this year to give them more room to push through some painful reforms to deal with a rapid build-up in debt, Reuters reports.
On the subject of tackling China’s pollution issues, Li Keqiang pledged to “work harder” to address the issue exacerbated by heavy industry.
This year’s “lianghui” comes ahead of a major Chinese Communist Party congress, due to be held later this year.
That congress will confirm party chief and President Xi Jinping’s second term in office, as well as announce changes in the party’s top leadership.
According to official figures, the Indian economy grew at an average rate of 7.5% in 2015, faster than the 6.9% growth in China.
In recent history it has been unusual, but not unprecedented, for India to grow faster than China.
It happened in 1981,1989,1990 and 1999, and 2015 was the first instance in this millennium, according to the IMF.
India’s government said growth in the October to December quarter was 7.3%, a slight drop on previous quarters which were revised sharply higher.
Even though the economy lost steam in the last quarter, its pace of expansion was faster than the growth posted by China in the same quarter.
India measures its economy over a fiscal rather than a calendar year.
The government of Narendra Modi said the Indian economic growth for the fiscal year ending March 2016 is forecast to accelerate to 7.6%.
However, some economists say the latest growth figures are at odds with other data for Asia’s third largest economy, including weak exports, railway freight, cement production and investment and flat order books.
A year ago India’s statistics ministry revised GDP growth rates higher – closer to that of China – by updating the base year used for price comparisons.
The Chinese economy grew by 6.9% in 2015, compared with 7.3% in 2014, marking its slowest growth in 25 years.
China’s growth, seen as a driver of the global economy, is a major concern for investors around the world.
The government had set an official growth target of “about 7%” for the world’s second-largest economy.
PM Li Keqiang has said weaker growth would be acceptable as long as enough new jobs were created.
However, some observers say its growth is actually much weaker than official data suggests, though Beijing denies numbers are being inflated.
Analysts said any growth below 6.8% would likely fuel calls for further economic stimulus. Economic growth in Q4 of 2015 edged down to 6.8%, according to China’s national bureau of statistics.
After experiencing rapid growth for more than a decade, China’s economy has experienced a painful slowdown in the last two years.
Some argue that China’s focus on creating an economy driven by consumption is misplaced. They say as the country attempts to rebalance its economy, it should focus on productivity in order to sustain high growth.
China’s economic growth slowed to 6.9% in Q3 of 2015, the weakest rate since the global financial crisis.
The year-on-year growth rate is also below the government’s 7% target.
Though slightly above expectations, the data is expected to raise pressure on policymakers to step up monetary policy to stem the slowdown.
China’s economy has been hit by extreme stock market volatility over the summer and weak economic data, causing concern on markets around the world.
Most analysts were expecting growth figures of 6.8% for Q3 of 2015.
The latest growth figure comes after a slew of disappointing data out of China. Earlier in the month, manufacturing data suggested the sector continued to contract for September.
Imports saw a sharp fall for the past month while inflation eased by more than expected, adding to fears of a rapid slowdown in the world’s second largest economy.
China has been attempting to shift from an export-led economy to a consumer and services-led one.
Beijing set an official growth target of “about 7%” for the overall year but PM Li Keqiang said a lower growth rate was also acceptable, as long as enough new jobs were created.
Analysts say the steep fall in imports suggests domestic demand is not as strong as the government would have hoped.
The slowdown comes despite repeated interest rate cuts and other stimulus measures introduced by Beijing.
They could be seen in the industrial production data, in heavy industry and other sectors.
In Q2 of 2015, growth did beat expectations, coming in at 7% from the previous year, matching growth in the first three months of the year.
Economists are, however, continuing to call for more government action, as volatility in the stock markets sparks concerns of financial turmoil and potential social unrest.
According to latest figures, growth in China’s investment and factory output in August 2015 has come in below forecasts, in a further indication that the world’s second-largest economy is losing steam.
Factory output grew by 6.1% from the year before – below forecasts of 6.4%.
Growth in fixed-asset investment – largely property – slowed to 10.9% for the year-to-date, a 15-year low.
Growing evidence that China’s economic powerhouse is slowing down has caused major investment market falls.
Other indications that China’s economy is weakening can be seen in falling car sales and lower imports and inflation.
Chinese manufacturers cut prices at their fastest pace in six years, largely on the back of a drop in commodity prices, which have dropped sharply over the past year as demand from China faltered.
Last week, Chinese PM Li Keqiang, said his country remained on track to meet all its economic targets for this year despite the economic data.
China has already cut interests rates five times since November 2014 to encourage lending and spur economic activity, along with other measures to boost growth.
PM Li Keqiang pledged that China would take more steps to boost domestic demand and that it would implement more policies designed to lift imports.
China recently revised down its 2014 growth figures from 7.4% to 7.3% – its weakest showing in nearly 25 years.
For 2015, the Chinese government is targeting annual economic growth of about 7%.
Meanwhile, the Chinese authorities said they would take new steps towards a more market-based economic system by offering shares in state-owned businesses to private investors.
The move, which they said would help improve corporate governance and asset management, is planned to take place before 2020.
China’s industrial economy is dominated by 111 conglomerates which are state owned.
European stock markets have fallen sharply as fears of a Chinese economic slowdown continue to haunt investors.
London’s FTSE 100 index was down by 2.6% in morning trade, while major markets in France and Germany lost nearly 3%.
Meanwhile, Asian shares were hit overnight, with the Shanghai Composite in China closing down 8.5%, its worst close since 2007.
The Chinese authorities tried in vain to reassure investors.
In addition, oil prices have plunged to six-year lows, as traders worry about slowing growth in the world’s second-largest economy.
Widespread investor fears about the sharp drops in Asia were exacerbated by thin trading volumes in Europe, with many investors away on holiday.
Investors might have to wait for several weeks for bargain hunters to come into the market to lift stocks.
Beijing’s latest intervention, to allow its main state pension fund to invest in the stock market, failed to calm traders’ fears, both in China and abroad.
Over the past week, the Shanghai index fell 12%, adding up to a 30% drop since the middle of June.
The sharp fall sparked a global sell-off, with the Dow Jones in the US losing 6%, while the FTSE 100 posted its biggest weekly loss this year, of 5%.
Earlier this month, the Chinese central bank devalued the yuan in an attempt to boost exports.
European investors worry that a cheaper Chinese yuan will make European exports less competitive.
China’s economic growth beat expectations in Q2 2015, but it was still the weakest showing since the global financial crisis.
The world’s second largest economy grew 7% from a year ago – matching growth in Q1 2015, which was the lowest since 2009 when it fell to 6.6%.
A weaker property market and factory production have hampered growth.
Meanwhile, Beijing has rolled out a series of stimulus measures amid the slowdown.
The central bank cut interest rates for the fourth time since November last month to boost economic activity.
Economists are, however, continuing to call for more easing despite the better-than-expected numbers as volatility in the stock markets has sparked concerns of financial turmoil in China.
Growth was expected to dip below the 7% mark and come in at 6.9% for Q2 2015.
The mainland’s benchmark index, the Shanghai Composite, had lost almost a third of its value in the three weeks from mid-June.
The positive growth figures failed to excite investors with the index down 2.4% to 3,830.49 points, while Hong Kong’s Hang Seng index was lower by 0.5% to 24,995.95.
On a quarterly basis, China’s economy expanded 1.7% from April to June, compared to the 1.4% revised figure in Q1 2015.
The government has also had to respond to suggestions that the better data may have been “inflated”.
The National Bureau of Statistics said on July 15 that the data reflecting the positive changes in the economy was “hard won”, and accurate.
Julian Evans-Pritchard, China economist at Capital Economics said that while actual growth is “almost certainly” a percentage point or two slower than the official figures show, it does point to signs of a stabilizing economy.
“More broadly, with the drag from the structural slowdown in property and heavy industry now easing, we think that growth is on track to slow only gradually over the course of the next few years,” he said in a note.
Industrial production and retail sales in June were all above forecasts, while fixed-asset investment, a major driver of the economy, also beat expectations in the period.
China’s growth slowed further in Q1 2015, expanding 7% compared to a year earlier, its slowest pace since the global financial crisis in 2009.
The rate was lower than the 7.3% posted for Q4 2014.
In 2014, China’s economy, which is the world’s second largest, grew at its slowest pace since 1990.
It expanded by 7.4% in 2014, missing its annual growth target of 7.5% for the first time in 15 years.
Despite the slowdown, the Chinese economy was still one of the world’s fasting-growing and analysts have said it was proving to be more resilient than expected.
However, they have also said that slower growth, together with China’s cooling property market – a key economic driver – was likely to mean further easing by its central bank this year, including further rate cuts among other measures.
In February 2015, the People’s Bank of China unexpectedly cut interest rates for the second time since last November.
Interest rate cuts together with injections of liquidity are some of the tools Beijing uses to fine tune its economic growth.
The latest growth numbers were by no means a hard landing – which some had feared – and were in line with the latest government target, analysts said.
In Q1 2009, amid the financial crisis, China’s economy expanded 6.6% from a year earlier.
China also released industrial production (IP) figures on April 15 which fell to 5.9% month-on-month in March, down from forecasts for an expansion of 6.9% and the lowest since 2008.
Analysts said these figures were more glaring than the growth data.
Markets were lacklustre following the numbers however, with Hong Kong’s Hang Seng index up 0.7% and the benchmark Shanghai Composite flat, up just 0.01% at 4,135.91.
China’s economic growth has reached its slowest pace since the global financial crisis, causing speculation the government may introduce more stimulus measures.
China’s GDP rose by 7.3% in the third quarter from a year earlier, compared to 7.5% in the previous quarter, official data showed.
The figure beat market forecasts for 7.2% growth but still marked its weakest performance since March 2009.
Industrial production also came in better than analyst estimates.
Manufacturing output rose 8% in September against a year earlier. However, fixed asset investment and retail sales missed expectations.
China’s economic growth has reached its slowest pace since the global financial crisis (photo Reuters)
China’s National Bureau of Statistics said retail sales increased 11.6% from a year earlier, compared to forecasts for 11.7%.
Fixed-asset investment excluding rural households rose 16.1% in the first nine months from a year earlier, below analyst estimates for a 16.3% increase.
Overall, the figures show that growth continues to slow in the world’s second-largest economy, raising concerns it may have knock-on effects on the strength of the global recovery.
China’s government aims to achieve 7.5% economic growth this year, but many analysts believe that they will not be able to meet that target.
There is also speculation the government may take more steps to boost growth.
Beijing recently unveiled measures aimed at stimulating more consumer spending, including relaxing its limits on home purchases and injecting billions of dollars into its biggest banks.
China’s central bank also cut the interest rate it pays lenders for 14-day repurchase agreements last week.
[youtube SCc16Eglpxw 650]
This website has updated its privacy policy in compliance with EU GDPR 2016/679. Please read this to review the updates about which personal data we collect on our site. By continuing to use this site, you are agreeing to our updated policy. AcceptRejectRead More
Privacy & Cookies Policy
Privacy Overview
This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
