The growth of China’s GDP in the second quarter of 2016, according to official data amounted to 6.7%. However, not all analysts believe in these figures.
“The official figure is about 7%, but these statistical data is prepared in the kitchen,” says chief economist Willem Buiter, chief economist at Citigroup. In his opinion, China’s rise is not more than 4%.
GDP growth was 6.7% in the first quarter of 2016. Analysts predicted that the second quarter will be 6.6%. The quarterly growth rate even increased: from 1.1 percent in the first quarter to 1.8% in the second.
“This increase is hard to believe, given the structural problems of the Chinese economy,” writes the research firm Capital Economics. Analysts believe that, judging by the price index real growth in China was 4.5%.
Photo: Capital Economics
Photo: Capital Economics
According to the Beige book of China” (CBB) is a research conducted among thousands of Chinese companies in the second quarter has improved most of the indicators, though business activity was sluggish throughout the year. Less than 50% of respondents reported increased sales, improvement in recruitment, investment or Bank lending.
According to Capital Economics, the stabilization of the growth caused by fiscal incentives. Growth will weaken in the future if the Chinese authorities do not invest money again.
“If policymakers begin a new phase of monetary easing, the growth caused by the stimulus will weaken by early next year,” writes Capital Economics.
Many analysts are still waiting for economic restructuring and growth, based on consumption, not investment. But this is not happening, says Buiter.
“China’s economy is in standby mode, and this situation will not change until there is a long-term restructuring and will not be solved by political problems, reflected in the anti-corruption campaign. In addition, the need to consider fiscal policy”.
If the government will not reform in the near future, China is not expected to rise more than 6%, says Buiter. “The belief that China is able to manage its currency and a sharp slowdown in activity, falling.
