There are worrying signs ofChina’s economy: For the first time since 1974 United State They will grow more than the dragon. when Xi Jinping Approaching the crucial twentieth conference of Communist Party, from which he must receive his historic third term, alarm bells ring and Beijing must run for cover. It should be read this way as it is reconstructed printingYesterday’s decision central bank, which injected 10 billion yuan, just under 1.5 billion euros, into the banking system in order to ensure the necessary liquidity. It also surprisingly cut 5-year lending rates by 15 basis points from 4.60 to 4.45%. This is a decision that goes against the trend of global central banks, which are working to support an economy that is showing some difficulties.
Achieve 5.5% annual growth target for China It would be complicated to say the least, given that industrial production slowed 3% in April. Instead, retail sales fell 11% year over year. Then there is a fileCaixin . index It dropped to 36.2, thus below the 50 average. This means that most Business They had one contraction activities. Not going better real estate market: Sales fell by 46.6%.
Why is it about the Chinese economy
The photo was taken by printing Justifies concerns about the Chinese economy. The reasons are many, start with restrictions Needed to fight covid Xi Jinping. Unemployment has risen to 6.1%, close to that recorded during the Covid pandemic. But data on young adults between the ages of 16 and 24 is also a cause for concern, such as Unemployment rate It reached 18.2%. The goal of becoming a modern consumer society seems out of reach for Beijing. State coffers are less prosperous. After all, tax revenue last month fell 41% due to the support provided to Business To support the effect of restrictions. The fact that a post-Covid era is not in sight adds to other concerns. he was there waiver to host 2023 AFC Asian Cupa competition for which new factories have been built: This is a confirmation that reopening is far away.
This full picture shows why foreign companies, as well as foreign investors, are fleeing China. As I mentioned before financial timesIn April, there were even disposals of the equivalent of $16 billion in Chinese debt. In the first quarter of 2022, $35 billion worth of bonds were offloaded. There are also surveys conducted by foreign chambers of commerce in China that American and European companies are considering leaving. Even the high-tech giants are paying the price. Now to reduce the damage Communist Party He is considering loosening the grip on the private sector, but discontent is growing, especially over the zero-Covid strategy.
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