China GDP beats expectations to grow 6.8% in third quarter

Jan 21, 2017, 00:32
China GDP beats expectations to grow 6.8% in third quarter

And retail spending is growing at the fastest annual rate in a year.

In 2016, China's GDP grew at 6.7%, the country's lowest growth rate in 26 years, but at least it somehow managed to still meet government expectations. Nevertheless, the 2016 GDP falls within the government's target range of 6.5 percent to 7.0 percent.

Growth in the fourth quarter of 2016, in fact, came in at 6.8%, accelerating from the 6.7% in the third quarter, according to the National Bureau of Statistics (NBS), which shared the data at a press conference. Just $5 a month. In a report, Wang's team estimated that total government debt past year reached 50 trillion yuan ($7.2 trillion), or 68% of GDP, up from 43 trillion yuan, or 62% of GDP, in 2015.

Industrial production slid from 6.2 per cent growth in November to 6 per cent, while fixed asset investment - a proxy for construction and infrastructure spending - also fell.

Property and infrastructure construction, together with a credit boom, played a key role in stabilising the economy a year ago, according to analysts.

The country has relied on massive levels of credit to soothe its transition from an economy rooted to trade towards a more consumer-led model. "China's economy ended 2016 with short-term growth firmly on track, but long-term sustainability veering further off it", they said. Maintaining growth requires fending off policy challenges including a slumping yuan that posted its biggest annual drop in two decades. U.S. Treasury Secretary nominee Steven Mnuchin said during a confirmation hearing he was ready to label Beijing a currency manipulator, while Commerce nominee Wilbur Ross has called China the "most protectionist" nation among the major economies. This helped fuel a rally in property prices, adding to concerns of a new asset bubble.

At the World Economic Forum in Davis on Tuesday Chinese President Xi Jinping warned that China's economy "faces downward pressure and many difficulties".

Despite a protracted slowdown, China's contribution to the world's economic growth may again top that of all other economies, even exceeding the figure for all developed economies combined.

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