Data point to Chinese economy shrugging off sluggishness and stabilizing

Updated: 2016-04-22 07:08

By Andrew Moody(China Daily Europe)

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Data point to Chinese economy shrugging off sluggishness and stabilizing

Has the Chinese economy finally turned the corner? Although first quarter GDP growth of 6.7 percent published on April 15 was the slowest since the financial crisis, most of the recent economic data now point to the economy stabilizing.

Growth was boosted by a revival in the housing market, with property investment rising by 6.2 percent, its fastest pace for a year, and also by a 10.7 percent increase in fixed asset investment, mainly on infrastructure projects.

There is also evidence the economy is continuing to restructure away from manufacturing and traditional industries with services expanding at 7.6 percent - making up 56.9 percent of total GDP growth.

The economy also generated 3.18 million jobs in the first quarter, just under a third (31.8 percent) of the government's target for the whole year.

Most of the indicators point to China shaking off some of the sluggishness that was particularly evident in the second half of last year.

The International Monetary Fund immediately raised its forecast for China's 2016 growth from 6.3 to 6.5 percent in line with the government's forecast of between 6.5 and 7 percent.

The GDP figures were published only two days after the announcement of a surge in China's trade performance, with exports increasing 18.7 percent in March, after falling in January and February; and imports declining just 1.7 percent, compared with an 8 percent fall the previous month.

Sheng Laiyun, a spokesman for China's National Bureau of Statistics, said the first-quarter performance suggests a new momentum in the economy.

"We have no reason not to conclude that the Chinese economy has had a good start (to the year)," he said.

Louis Kuijs, head of Asia economics at Oxford Economics, also believes there are finally grounds for optimism.

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