A twofold trend

ChinAfrica - - Business -

The rea­sons be­hind the cur­rent eco­nomic sit­u­a­tion are twofold. First, China’s ex­port growth - which dropped sig­nif­i­cantly dur­ing the global eco­nomic melt­down - is not out of the woods yet.

China’s ex­ports reg­is­tered a 15-per­cent growth year on year in the first six months of 2017, a sign that the econ­omy is hold­ing up bet­ter than ex­pected.

Yet, we should not be overly op­ti­mistic about China’s ex­port per­for­mance in 2017 on the whole given un­cer­tain­ties in other ma­jor economies. Over­all, there is a high like­li­hood that China will be able to end neg­a­tive growth in ex­ports and that the econ­omy will con­tinue to sta­bi­lize.

Se­cond, China’s ur­ban­iza­tion con­tin­ues to main­tain its strong mo­men­tum de­spite some dif­fi­cul­ties. For a long time, the lack of pop­u­lar­ity of many small and medium-sized cities - a ma­jor bottleneck for their fur­ther devel­op­ment - has re­stricted their ur­ban­iza­tion process, the im­prove­ment of peo­ple’s stan­dard of liv­ing, the up­grad­ing of the coun­try’s con­sump­tion struc­ture and the ex­pan­sion of mar­ket de­mand.

As a re­sult, real es­tate en­ter­prises in­volved in ur­ban devel­op­ment have had to face many prob­lems, such as dif­fi­culty in sell­ing houses in small and medium-sized cities.

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