Article: https://www.reuters.com/article/us-china-economy-gdp/china-first-quarter-gdp-growth-set-to-slow-to-6-3-percent-more-policy-support-needed-idUSKCN1RS2F1
This Wednesday, China is expected to report the slowest economy growth they have had in the past 27 years - 6.3%. However, investors and trading partners alike are confident recent data will demonstrate economic recovery. Though these hopes are still left with questions regarding the length and prominence of said rebound.
To support recovery, China has cut taxes by billions of dollars and have also increased infrastructure spending to jump-start growth. Their banks have also lent out a first quarter record of $864.8 billion dollars which is larger than Switzerland's GDP. However, many experts are still saying more needs to be done in order to get China back on its feet.
China should be watched with a close eye as it is the second largest economy in the world. Even though China has grown considerably faster than other economies, the U.S. for example, they are still playing a catch-up game. Even though China has been in a position to grow so quickly, it is worrisome to see their growth cool down.
3 comments:
It's very interesting that China's exceptional growth in recent years has made it so 6.3% growth is the lowest they've seen in years. As I haven't done ample amounts of research, I think most can agree that at some point China's growth will have to slow and return to what some may deem normal. With the tariffs, and significant amount of government expenditure and tax cuts, it is good to see that they are looking ahead.
I wonder what role (or how significant of one) the United States is playing in the slowed growth, or what impact the trade war will have on them trying to restore growth in the future. However, in the article, they do seem pretty confident that this policy prescription to stimulate growth will work in the near future, so I am interested to see exactly what the numbers look like later this year and moving forward.
I think that China's exuberant growth was bound to slow down at some point so this is not a huge surprise. I would be curious to see if the Chinese government decides to do any other expansionary policies in an attempt to get them back on their feet and what those policies might entail. I think the US and their renegotiation of trade did have some impact on this slowdown of growth, to what extent I could not say without further research. It is shocking to hear that the Chinese banks are able to loan out that amount of money. It just shows how large China's economy truly is.
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