Experts on China have lowered their predictions for China’s economic performance this year to an average of 4.8 percent, according to the latest quarterly survey by Nikkei. That’s down from 4.9 percent in July’s survey.
The 25 economists who provided full-year forecasts took into account the government’s recently announced stimulus rollout, devised to get the country back on track towards achieving its official growth target of around 5 percent. In the second quarter, respondents’ predictions ranged from 4.8 to 5.3 percent; in the third quarter, the range was lowered to 4.5 to 5 percent.
KGI Asia’s Ken Chen suggested that Beijing’s new stimulus measures might not be enough to turn the mainland’s lacklustre figures around. “The current economic growth trend is still downward, mainly due to the bottoming out of the real estate cycle and downward pressure from external demand,” he told Nikkei.
Asked to identify the three biggest risks to China’s economy, the survey’s respondents’ top choices were “sluggish housing market,” “weak consumer confidence” and “lack of or insufficient policy.”
[See more: Beijing announces new stimulus measures to boost the economy]
Nikkei also pointed to heightening trade protectionism as a concern, particularly from North American and European countries – though Indonesia has also reimposed tariffs on goods including Chinese textile imports.
ABN AMRO Bank senior economist Arjen van Dijkhuizen said that China’s supply-focused strategy was contributing to “a broadening of trade spats” with markets looking to protect strategic sectors against Chinese oversupply.
Jing Liu, chief economist for greater China at HSBC, noted that the People’s Bank of China’s recent rate cuts pointed to “the urgency faced by policymakers to provide support,” while Jian Chang, Barclays’ chief China economist, said they “signalled that China’s leadership is taking a more proactive approach to tackling its most pressing structural issues.”
Nikkei reported that if an even more substantial fiscal push happened soon, economists could revise their forecasts upwards.
