China’S Economic Outlook: Experts Lower 2024 Growth Forecast To 4.8%

(MENAFN- The Rio Times) China's economic landscape faces new challenges as experts revise their growth projections downward. A recent survey of 28 local analysts reveals a shift in expectations for the country's economic performance.

The average forecast for China's GDP growth in 2024 now stands at 4.8%, down from the previous estimate of 4.9% in July. This adjustment comes after recent government interventions.

Chinese authorities have taken steps to stimulate the economy by cutting interest rates and bolstering the real estate market. They have also injected billions into the stock market.

Despite these efforts, many economists have lowered their growth expectations. The outlook for the third quarter of 2024 appears less optimistic than earlier periods.

Analysts predict an average growth of 4.6% for July to September, indicating a further slowdown from the 4.7% growth seen in the second quarter.



This figure falls short of the 4.9% expansion recorded in the same period last year. Several factors contribute to this cautious outlook.

Ken Chen from KGI Asia cites weaker than expected data across various sectors as a reason for lowering his annual growth forecast.

He points to declines in industrial production, investments, retail sales, and real estate as key concerns. The struggling real estate sector remains a significant hurdle for China 's economy.
Challenges in China's Housing Market
Despite policy efforts to reduce mortgage rates and purchase costs, the housing market continues to face challenges. When asked about potential risks, 17 out of 20 respondents identified the "weak real estate market" as a top concern.

Consumer confidence also emerges as a critical issue. The real estate sector's troubles directly impact household wealth, as property accounts for about 70% of Chinese families' assets.

This wealth effect dampens consumer sentiment and raises concerns about potential deflation. Experts also highlight structural challenges facing China's economy.

The country's aging population and underdeveloped pension system may lead to a long-term decline in consumer demand.

This demographic shift, partly a result of the former one-child policy, complicates efforts to stimulate economic growth. China's manufacturing and export sectors, traditionally strong pillars of the economy, show signs of weakening.

Industrial production growth slowed to 4.5% year on year in August, down from 5.1% in July. This decline coincides with rising trade protectionism from major trading partners.

As China navigates these economic headwinds, the government's target of "around 5%" GDP growth for the year appears increasingly challenging. Analysts suggest that current stimulus measures may not be sufficient to achieve this goal.

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