Data show sta­bi­liza­tion trend in GDP growth

China Daily (Canada) - - FRONT PAGE - By LI XIANG in Bei­jing lix­i­ang@chi­

Econ­o­mists say the lat­est eco­nomic data shows growth that’s steady and a big­ger chance for China to meet its yearly growth tar­get, al­though some longterm con­cerns re­main.

The coun­try’s gross do­mes­tic prod­uct ex­panded 6.7 per­cent year-on-year in the third quar­ter, the same fig­ure as in the pre­vi­ous quar­ter, the Na­tional Bureau of Sta­tis­tics re­ported on Wed­nes­day.

The growth was sup­ported to a great ex­tent by surg­ing prop­erty sales and govern­ment ef­forts to boost in­fra­struc­ture in­vest­ment, econ­o­mists said.

Other in­dexes con­firmed the econ­omy’s sta­bi­liza­tion. Fixedas­set in­vest­ment in the first three quar­ters edged up by 8.2 per­cent year-on-year, sup­ported by com­mit­ment to cap­i­tal in­fra­struc­ture and real es­tate in­vest­ment.

In re­tail, sales grew by 10.4 per­cent year-on-year, re­flect­ing ro­bust con­sumer de­mand.

Pri­vate in­vest­ment, a wor­ri­some fac­tor in the econ­omy in the pre­vi­ous two quar­ters, showed a sign of quick­ened re­cov­ery, in­creas­ing by 2.5 per­cent in the first three quar­ters, com­pared with 2.1 per­cent for the first eight months.

“The re­cent data sug­gest the econ­omy has ex­pe­ri­enced an ex­tended pe­riod of macroe­co­nomic sta­bil­ity, prob­a­bly the long­est in some time — al­beit at 25-year lows,” said Jeremy Stevens, chief China econ­o­mist at Stan­dard Bank. The bet­ter than ex­pected eco­nomic data also prompted

econ­o­mists to raise their fore­cast on China’s whole-year GDP growth, and many of them said the coun­try will be able to achieve its growth tar­get of 6.5 to 7 per­cent this year.

“We will now raise our 2016 real GDP growth fore­cast by 0.1 per­cent­age point to 6.6 per­cent from 6.5 per­cent, as Q3 growth was stronger than we ex­pected,” said Zhao Yang, chief China econ­o­mist with No­mura In­ter­na­tional (Hong Kong) Ltd.

Sheng Laiyun, spokesman for the NBS, said at a news con­fer­ence in Bei­jing that the prop­erty sec­tor was an im­por­tant fac­tor in boost­ing the econ­omy’s over­all growth, con­tribut­ing 8 per­cent to the GDP’s over­all in­crease in the first three quar­ters.

Econ­o­mists said that the de­vel­op­ment of the prop­erty sec­tor in China will be a key area to watch as a num­ber of Chi­nese cities have re­cently in­tro­duced mea­sures to pre­vent hous­ing mar­ket sales from over­heat­ing, which could weigh on over­all eco­nomic growth in the com­ing months.

“We ex­pect the buoy­ant hous­ing mar­ket to cool over the com­ing months, with slow­ing trans­ac­tions and slow­ing in­vest­ment,” said Chang Jian, chief China econ­o­mist at Bar­clay’s Cap­i­tal in Hong Kong.

While most econ­o­mists ex­pect China’s eco­nomic growth rate to stay above 6.5 per­cent this year, as govern­ment poli­cies con­tinue to bol­ster eco­nomic ac­tiv­ity, some ex­pressed con­cerns about long-term fac­tors that could sup­press growth.

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