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China’s economy to slacken in 2024
According to analysts polled by Nikkei, in 2024, Chinese economic growth will slacken to 4.6%. Notably, in 2023, experts foresaw a 5.2% expansion.
Economists explain the 2023 growth by a low base effect. The fact is that in 2022, the Chinese government introduced tight restrictive measures because of the Covid-19 pandemic.
Compared to the previous quarter, the average GDP forecast for 2023 was upgraded to 0.2 percentage points. At present, analysts are very cautious in their predictions, fearing that the crisis in the real estate market may deepen.
At the moment, many experts are pessimistic in their forecasts regarding the Chinese economy. The S&P Global Ratings agency allows for a decrease in China's economic growth to 2.9% in 2024. According to experts, a lot will depend on the situation in the real estate sector. Julius Baer has the same view on the situation, believing that a correction in the financial market will exert pressure on investments, household conditions, and the distribution of funds by local authorities.
Earlier, representatives of the Japan Center for Economic Research said that in the event of force majeure in the Chinese economy, the country's GDP would stagnate at the level of 1%. Experts attributed the formation of a bubble in the Chinese real estate market to the negative consequences. The fact is that the bubble could burst and provoke a financial crisis. In such a scenario, China will hardly double its GDP by 2035.
In early December 2023, it became known that the Chinese authorities had developed an emergency plan aimed at restoring the national economy after a protracted crisis. It consists of nine steps, each of which complements the previous one. At the same time, the Chinese authorities intend to achieve sustainable economic growth by attracting foreign investment and using innovations in the industrial and agricultural sectors.
Published 09 January 2024
© InstaFintech Group
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© InstaFintech Group
