Logo of Phnom Penh Post newspaper Phnom Penh Post - Experts say China likely to see growth rebound via policies

Experts say China likely to see growth rebound via policies

Content image - Phnom Penh Post
Night view of Guangzhou, Guangdong province on July 20, 2017. VISUAL CHINA GROUP/CHINA DAILY

Experts say China likely to see growth rebound via policies

CHINA’S economy grew 6.6 per cent year-on-year last year, down from 6.8 per cent in 2017, the National Bureau of Statistics (NBS) said on Monday.

Despite the easing of growth, economists said that as China’s supportive policies take effect, growth is expected to stabilise and recover as early as the first quarter of the year.

The country’s GDP for its first time exceeded 90 trillion yuan ($13.28 trillion) last year.

Growth in the fourth quarter of last year was 6.4 per cent, compared with 6.7 per cent in the first three quarters, said NBS head Ning Jizhe at a news conference on Monday. “Overall, the economy performed within a reasonable range in 2018 after it exceeded the preset growth target of about 6.5 per cent.”

World Bank lead economist for China John Litwack said: “GDP growth in 2018 was broadly in line with our expectations since the beginning of the year.”

Liu Chunsheng, an associate professor of economics at Central University of Finance and Economics in Beijing, said the growth of the Chinese economy edged down last year partly due to domestic moves to cut debt and uncertainties created by trade disputes with the US.

“Deleveraging moves and other restructuring policies, although necessary for long-term economic development, have led to short-term pain as they accelerated the knocking out of weaker players in the market.”

However, economic structure upgrading, which is reflected by the rising contribution of services and consumption, in tandem with strong domestic consumption and sound performance in trade and foreign investment inflow, has supported the economy in achieving growth that is rather outstanding in the context of the world economy, Liu said.

Economists remained confident that the Chinese economy will grow in a stable manner.

“We still expect good performance from China’s economy this year, although the pace of growth should be a bit slower,” Litwack said.

ICBC International chief economist Cheng Shi said economic structural upgrading, which leads to higher production efficiency, is shoring up the economy, which could start to rebound in the first quarter.

China is rolling out proactive fiscal policy and supportive monetary policy, the effect of which will gradually unfold, Cheng said. “The Chinese economy is likely to stabilise and rebound in the first quarter of this year, beating market expectations.”

The country’s ongoing tax reductions could offer a major boost to the economy this year, economists said.

A report from Peking University’s Guanghua Management School estimated the amount of cuts in taxes and fees could total 1.5 trillion yuan to two trillion yuan this year, and a reduction in value added tax and corporate income tax may come soon.

“To ensure sustainable economic development, China should give priority to revitalising the private sector and small enterprises, as they are the most efficient contributor to employment and technological advances,” said Yang Weiyong, an associate professor at the University of International Business and Economics in Beijing.

“Our primary advice is for China to stay focused on policies and reforms that can ensure strong growth over the medium and longer term. If some short-term growth needs to be sacrificed to accomplish this, it is well worth the cost,” said Litwack. These policies and reforms include measures to control credit growth and implement budget reform, he said. CHINA DAILY

MOST VIEWED

  • Historic Battambang town bans billboards

    The Battambang town administration informed all house and business owners in Svay Por commune to remove all billboards by August 1 as it is preparing to submit the town to UNESCO for inclusion on its historical cultural heritage list. Its July 25 notice said all signage was

  • All foreigners' accommodations to be inspected: Sar Kheng

    The Ministry of Interior is undertaking a serious effort to inspect all the accommodations of foreigners in Cambodia – except diplomats – in order to find and identify human traffickers. Minister Sar Kheng said this would include inspections on the homes of foreigners employed by businesses, private

  • Ice cream, noodles flagged over carcinogen

    The General Department of Customs and Excise of Cambodia (GDCE) has identified three types of instant noodles and ice cream trademarks originating from Thailand, Vietnam and France that are suspected to contain ethylene oxide, which poses a cancer risk to consumers. The general department has

  • Exclusive interview with Josep Borrell Fontelles, High Representative of the EU

    CAMBODIA is hosting the 55th ASEAN Foreign Ministers’ Meeting (AMM) and Related Meetings this week with top officials from the US, China, and Russia and other countries in the region slated to attend and to meet with face-to-face with their counterparts on the sidelines. In

  • Rise in Thai air routes to Siem Reap fuels travel hopes

    Local tourism industry players are eager for regional airline Bangkok Airways Pcl’s resumption of direct flight services between the Thai capital and Siem Reap town on August 1 – home of Cambodia’s awe-inspiring Angkor Archaeological Park – which is expected to boost the growth rate of

  • ASEAN Foreign Ministers’ meet commences, Taiwan issue possibly on table

    The 55th ASEAN Foreign Ministers’ Meeting (AMM) and related meetings hosted by Cambodia kicks off in Phnom Penh on August 3, with progress, challenges, and the way forward for the ASEAN Community-building on the table. Issues on Taiwan, sparked by the visit of US House Speaker