China Economy

What makes the world's second largest economy tick
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Background explainers, news and analysis on China’s economy, including its opening up, the US-China trade war, the impact of tariffs and trade talks, growth rates and other key economic data, the Belt and Road Initiative, and Greater Bay Area plan.

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The main issue concerning investors is whether central banks are done raising interest rates and, if so, how large any cuts that happen will be. The spotlight shifting from China could offer policymakers more breathing room to act but also risks lulling investors into a false sense of security.
The Chinese leadership’s advocacy for measures to support and spur growth in the private sector economy intensified in 2023, but the protection of private firms’ assets and rights remain a concern.
SCMP ColumnistZhou Xin
Much like those who expected a roaring economic recovery in China this year, bears forecasting doom and gloom risk making a costly mistake. Stronger-than-expected data increases the scope for a meaningful rally, and investors would do well to show some humility in their predictions.
Recent deal between China and Saudi Arabia is an important step as world wakes up to the consequences of denominating almost all global trade in the American currency.
Failure to anticipate and prepare for weaker growth would mean the city sleepwalks into stagnation, or worse, lurches from one crisis to another, writes Donald Low – not unlike during the pandemic.
While there are issues to be dealt with, the fundamentals of China’s economy are still sound, the government has ample room to adapt policies and the country’s industrial development will see it through the current property sector downturn and demographic headwinds.
World leaders agree artificial intelligence in the wrong hands could be a threat to humanity and have taken steps to avoid such a scenario.
If Beijing wants to get growth back on track, it needs to succeed in key areas where Japan failed following its bad-loan crisis. These include being bold, treating the causes not the symptoms, avoiding policy blunders and having the political will to act
Even after its first foreign investment deficit, China remains an attractive market for many firms, but bureaucrats need to do more to attract business.
SCMP ColumnistZhou Xin
Beijing leaders assure nations, regions and groups attending Shanghai showcase that country’s middle-class consumer colossus can drive global recovery.
The announcement that China will lift all restrictions on foreign participation in manufacturing shows the continued shift towards inclusiveness. Assuming the government addresses foreign firms’ concerns, expect more high-quality foreign investment in the manufacturing sector.
As China’s prospects darken, a bullish narrative is growing that India could become the biggest contributor to global growth. But this might be wishful thinking, given that while India has a large and youthful population, its labour force participation rate is worryingly low.
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