China’s economy slowed down in the second quarter of the year, according to official data, coinciding with a critical meeting of top leaders aimed at addressing the sluggish growth.
The economy grew by 4.7% from April to June, which was below expectations following a stronger performance in the first quarter of 2024.
The Chinese government had set an annual growth target of around 5%.
Analysts, like Heron Lim from Moody’s Analytics, described the economic slowdown as China hitting the brakes.
The ongoing Third Plenum meeting in Beijing, where over 370 senior Communist Party members are gathered, is expected to discuss solutions to these economic challenges.
The meeting holds historical significance as past Plenums have influenced major policy shifts in China.
There are hopes that this year’s gathering, chaired by President Xi Jinping, could introduce substantial reforms to bolster the economy.
State-controlled media has been optimistic, suggesting that reform-focused policies are high on the agenda, possibly signaling a new phase of reform and opening up.
Despite these expectations, there are concerns about the extent of openness to bold reforms under President Xi’s centralized leadership.
Many analysts doubt the meeting will provide immediate remedies for the current economic slowdown, as its focus appears to be on longer-term strategies to unlock China’s growth potential.
Recent economic indicators paint a challenging picture for China. The property crisis has severely impacted the construction sector, with falling home prices and abandoned projects adding to economic woes.
The slowing producer prices and cautious consumer spending reflect broader concerns about economic stability and consumer confidence.
Looking ahead, China’s strategy seems focused on bolstering high-tech industries and exports, despite facing trade barriers from major partners like the EU and the US.
This approach aims to sustain economic growth through technological advancements rather than short-term stimulus measures.
Overall, while the Third Plenum is expected to outline economic priorities, its immediate impact on China’s economic recovery remains uncertain amidst ongoing global challenges and internal economic pressures.
Credit : BBC
https://www.bbc.com/news/articles/cl4y6mexgz8o