China's GDP forecast to hover above 8 per cent

BEIJING (China Daily/Asia News Network): China is expected to see 8.1 per cent economic growth this year, as solid export performance and increased fiscal support in the second half will offset a more protracted recovery in household consumption, said economists at the Asian Development Bank.

The forecast made by the Manila-based development bank on Wednesday (Sept 22) was unchanged from its projection in April.

However, the ADB lowered the GDP growth forecast for developing Asia, which groups 46 developing economies in the Asia-Pacific region that are members of the bank, to 7.1 per cent this year, down from the prediction of 7.3 per cent in April.

"We would expect a more protracted recovery in household consumption (in China), while at the same time, this would be compensated by higher infrastructure investment and ongoing good export performance," said Dominik Peschel, head of the economics unit for the ADB resident mission in China.

Economists at the bank expect household demand in China to further recover gradually, and this should also help the services sector.

"We think people will travel more and demand more services once the Covid situation is fully under control and the restrictions have been lifted," Peschel said.

China's recovery from the Covid-19 pandemic is in good shape, showing the strong resilience and vigorous dynamics of the economy, said Liu Qiao, dean of the Guanghua School of Management of Peking University.

The benchmark Shanghai Composite Index rose 0.4 per cent to 3,628.49 points on Wednesday. Overall market liquidity in the A-share market is adequate to stimulate further economic growth, said Zhu Hong, investment director of Nuode Asset Management.

Looking ahead, China's economic fundamentals are still strong and its future growth will remain stable in 2022, said David Chao, global market strategist for the Asia-Pacific region (except Japan) at Invesco, who added that the country could further tap the potential of its monetary policy to support the economy.

The ADB's economists also expect China's monetary policy to ease marginally.

"Another cut in the reserve requirement ratio is possible in the second half of this year," Peschel said.

"At the same time, credit to the real estate sector and shadow bank financing will remain tightly regulated."

Peschel said he is looking forward to more fiscal support because there is room to increase spending without incurring a high fiscal deficit as revenue recovers.

New issues of local government special bonds will pick up and will support infrastructure investment in the second half of the year, and manufacturing investment should expand solidly in line with robust exports, the report said.

The Organization for Economic Cooperation and Development said in its interim economic outlook released on Tuesday that China's real GDP is expected to grow 8.5 per cent this year and 5.8 per cent in 2022. Both figures are the same as the OECD's projections in May.

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights

China , GDP , forecast , ADB


Next In Aseanplus News

Myanmar junta re-arrests more than 100 released in amnesty: monitoring group
Singapore employment agency hacked, IC scans and salaries of 40,000 job seekers uploaded online
Businesses in Ho Chi Minh resume production as workers return
Extension of Covid-19 curbs leaves Singapore's retailers in despair
EMPRO aces viral filtration efficiency test
Thailand offers guidelines for people wanting to visit from Nov 1
Electrified cars hit almost a fifth of EU Q3 vehicle sales
Covid-19: 6,630 new cases bring total to 2,420,222
Wise up to African Swine Fever curbs, pig breeders told after Sabah's Papar district becomes latest outbreak zone
Myanmar reports 683 new Covid-19 cases, 21 more deaths

Others Also Read