Lower investment growth and consumer confidence will further dent China’s economic growth next year, according to an institute under China’s top planning agency.
Investment growth would slow to 9 per cent in 2016 as investment in manufacturing fell and spending on property stagnated, the Economic Daily reported on Sunday, citing the National Development and Reform Commission’s economic research institute.
Growth in household spending would also slow to single digits as slower income growth made consumers warier, the report said.
“China’s economy will face big downward pressures next year, and economic growth rate is likely to drop further,” the report said. GDP growth is forecast to come in at 6.9 per cent this year, the slowest since 1990.
The warning comes as top leaders, including President Xi Jinping and Premier Li Keqiang, provincial party secretaries and state conglomerate executives, meet in Beijing to discuss ways to arrest a deepening slowdown in the world’s second-biggest economy.
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While a Politburo meeting this month listed industrial overcapacity and a glut of residential property as priorities to tackle in 2016, it was not clear how the government would use its fiscal, monetary and industrial policy levers to achieve “reasonable” growth next year.