China's 2021 GDP growth likely to reach 8%
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Topics: CHINA
The rise in the prices has begun to be transmitted to the middle and downstream products
PHBS Think Tank sees that the downward pressure on China's real economy is still high in the fourth quarter, pointing to weak consumption, a significant decline of investment in infrastructure and real estate, and CPI upward pressure.
Since the prices of some upstream raw materials are still at high levels, the rise in the prices has begun to be transmitted to the middle and downstream products.
The slowdown in the property market and consumption is expected to continue acting as headwinds
The slowdown in the property market and consumption is expected to continue acting as headwinds to the growth of the world's second largest economy. Based on its DSGE model, the Think Tank estimates that a 10% decline in real estate investment will lead to a 2.1% decrease in GDP growth, causing the loss of 6.85 million jobs in the related sectors.
The report includes the forecast results that the contribution to China's GDP from consumption, investment, and net export will be 1.9 percentage points
The report includes the forecast results that the contribution to China's GDP from consumption, investment, and net export will be 1.9 percentage points, 1.7 percentage points, and 1.4 percentage points, respectively.
PHBS Think Tank suggests that more proactive policies need to be implemented in 2022. It advises that the government strengthens the fiscal policy to increase domestic consumption and infrastructure investment and ensure the supply of upstream raw materials. Furthermore, the report concludes that effective policies for loan granting and financing are needed to avoid the hard landing of the real estate industry. ■