Data show stabilization trend in GDP growth
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.