China economy needs new stimulus plan after November data disappoints, economists agree
- Industrial production, export growth rate, foreign investment, domestic consumer spending and weak car sales hit as trade war with the United States takes effect
- Top officials including Xi Jinping will discuss policy for 2019 at next week’s Central Economic Work Conference in Beijing
Winter has arrived for the Chinese economy, with a series of activity data plunging to multi-year lows in November.
And the situation is only likely to worsen next year, as the full force of the trade war with the United States hits home, economists said.
Beijing is expected to introduce a more aggressive economic stimulus package early next year to help stabilise growth, but policymakers should pay more attention this time to the effects of their measures on the economy, as the steps they have taken since July to draw a line under weakening growth have not worked, the economists warned.
The Politburo, the nation’s top decision-making body led by President Xi Jinping, has shown more tolerance to slower growth by this time making no reference to “downward pressure” in the statement after its meeting on Thursday, instead repeating its intent to “stabilise” the economy – first muted in July – and build “a powerful home market” next year to offset the effects of external uncertainties from the trade war.
Most economic data for November released in the past two week has been extremely weak.
“[The data] showed the Chinese economy is unlikely to reverse its downward trend in the short term,” Shen Jinaguang, chief economist at JD Finance, told the South China Morning Post.