China’s property, construction sectors contract as Evergrande crisis, tougher regulation hit home
- Output in the real estate and construction industries shrank 1.6 per cent and 1.8 per cent respectively in the third quarter of 2021
- Effects of Beijing’s crackdown on overheated property market and a debt crisis at country’s biggest developer have started to ripple through the economy
China’s property and construction sectors contracted in the third quarter for the first time since the start of the coronavirus pandemic, hurt by a slump in real estate as the China Evergrande Group debt crisis and the effects of Beijing’s tougher property market regulation spread to other parts of the economy.
Output in the real estate and construction industries shrank 1.6 per cent and 1.8 per cent respectively in the third quarter of 2021, according to a supplemental report on China’s gross domestic product released by the National Bureau of Statistics (NBS) on Tuesday. Both sectors contracted for the first time since the first quarter of last year, when the pandemic began.
A day earlier, NBS data showed the growth rate of China’s property development investment slowed to 8.8 per cent in the January-September period from 10.9 per cent in the first eight months of the year.
The Evergrande [issue] has had some impact on everyone’s confidence
The effects of Beijing’s crackdown on the overheated property market and a debt and cash crisis at the country’s biggest developer have started to ripple through the economy, manufacturers say.