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China trade slumps in first half of year: government

– ‘New normal’ –
The latest report comes as Chinese authorities manage what they describe as a “new normal” economy in which they steer it away from a traditional model of high growth based on big investment projects and towards one where consumer demand takes prominence.

China’s gross domestic product (GDP) expanded 7.4 percent in 2014, the lowest rate in nearly a quarter of a century, and signs of further weakness have mounted this year.

GDP expanded 7.0 percent in the January-March period, the worst quarterly result in six years.

China announces second-quarter GDP figures on Wednesday and the median forecast in an AFP poll of 14 economists indicates GDP expanded 6.9 percent in April-June.

For all of 2015, the survey predicts growth at a median 7.0 percent, more optimistic than a forecast of 6.8 percent in a similar poll in April and in line with the government’s official target of “about 7.0 percent”.

Authorities have taken steps to boost slowing economic growth, cutting interest rates four times since November while also lowering the amount of cash banks must hold in reserve in a bid to boost lending.

They have also had to deal with weeks of volatility on stock exchanges, taking aggressive measures to stabilise the Shanghai index, which fell more than 30 percent in less than four weeks before reversing course in the past three trading days.

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