Slowing Chinese Economy
Last few decades have been incredibly good for China when it comes to economic growth. It has been the world’s leading manufacturing hub and today is one of the main forces to be reckoned with when it comes to the global economy. However the Chinese economy is slowing down and this not just has an impact on China but also the rest of the world. Growth in China means the Chinese GDP figures for 2014 are a signal to suggest that China is slowing down. The following are details regarding the slowdown of the Chinese economy:
Slowing of the Chinese Economy
• China’s economic growth has faltered to the levels it hasn’t seen in 24 years. GDP growth of 7.4 % is the weakest it has been in 24 years and the Chinese economy has not met the target growth rate which it set for itself – 7.5 % which is not very good news for the Chinese economy.
• China is slowly moving from an investment driven export oriented economy to one where domestic consumption also plays a key role in the overall growth of the economy.
• The property rates in China have fallen considerably over the last year. Though the experts expected China not to meet its GDP growth goal for 2014, some believe it did better than expected.
• As China is a major global economy with trade ties all over the world, a slowing Chinese economy means bad news for the global economy which is already seeing some really bad economic news coming out of Europe and Japan.
• Currently China is facing sluggish demand, a possibility of deflation as consumers and investors hold of spending, hoping for a further drop in prices and a slowdown in manufacturing in the Chinese economy.
• An optimistic forecast suggests that China might grow at around 7 % GDP growth in 2015 but some experts say that the target of 7 % also looks difficult.
• The government in China is now looking to make the country a more domestic consumption based economy. Though policy measures are being adopted to reform and revive growth in China, more focus is not towards GDP growth and reform consumption based economics but on domestic economic sustainability of this growth for China’s vast population.
China is world’s second largest economy and there has been a very high GDP growth run for the country. The slowdown in China is likely to affect the entire world and revival of this growth story means good news for the world’s economy.