Growth rate target in sight but bumpy road ahead
Updated: 2016-10-28 16:32
By Nie Ligao(chinadaily.com.cn)
Editor's note: The National Bureau of Statistics of China recently released the economic data of the third quarter. Here five economists we interviewed from around the world share their views on the report and look at the full-year picture.
L-shaped growth is still immature but housing risks are controllable
Margit Molnar, Head of China Desk, Economics Department of OECD
As so far we have not come any close to the vertical part of the "L shape". The growth has so far been slowing gradually and even a somewhat faster slowing growth trajectory could be feasible without much disruption. Sharp deceleration, however, should be avoided.
Ａ burst of the bubble of the property markets would unlikely lead to systemic risk. In China, regulations with regard to housing loans are very stringent: for instance you cannot collateralize your house to take up consumption loans, and down payment ratios are high. Also, home purchase restrictions make it impossible to buy up a large number of apartments and in some cities more so for non-residents." More to read
No doubt China will reach full-year target but downward trend expected in 2017
Yeomin Yoon, Professor of Finance and International Business, Seton Hall University
Real estate investment seems likely to moderate in the near future, and this will put the economy on a bit downward trend in 2017.
Economic history amply demonstrates that no country maintained such high, dynamic economic growth rates as China did for the last 35 years, for which China's policymakers should be given credit. History also shows that no country can maintain double-digit growth rates for a long time, violating the law of gravity. China's economic growth rates will slow down but to rates much higher than the rates of others for the foreseeable future. "
Too early to be optimistic about China's economy
Yao Shujie，Professor of Economics, University of Nottingham and Chonging University
But it is too early to be fully optimistic about China's economic prospective as one cannot be absolutely certain that economic growth may not go any lower.
The rising house prices in the so-called first-tier cities of Beijing, Shanghai, Shenzhen and Guangzhou can become a grave uncertainty for the Chinese economy. Rising house prices have been a result of government land sales policy which is also deterring the integration of poor and rural migrants into cities." More to read
Risk of housing industry under control while the growth rate to fall further
Leon Berkelmans，International economy program director with Lowy Institute
We have seen successive waves of booms and busts in the property market in China for a number of years. I think what we are seeing at the moment repeats that pattern. I would be surprised if there was a crisis this time. One distinctive feature of the boom this time around is the increase in mortgage debt, but the overall level is still small. I think the bigger problem for the Chinese economy is the trajectory of corporate debt. "
Beijing sees cyclical stabilization and secular challenges
Dan Steinbock, Guest Fellow of Shanghai Institutes for International Studies (SIIS)
However, the key problem in China is not a cyclical hard landing, but medium-term rebalancing; a secular challenge, which must be achieved as the economy is decelerating - and balanced with the reduction of local debt, property markets' disruptive fluctuations, the SOE reforms and the liberalization of the financial sector." More to read