China, the economy slows down, the annual target of 5% is at risk. Beijing replies: «The West will be proven wrong»- time.news

2023-08-16 12:42:11

by Paolo Salom

According to the latest official data, industrial production slowed in July (+3.7% on an annual basis), after 4.4% in the previous month. The official reply (“The West will be proven wrong”), the decision to “obscure” the data on youth unemployment. And the Taiwan question

China is growing: but not as foreseen by the objectives set by the government.

According to the latest official data, industrial production slowed in July (+3.7% on an annual basis), after 4.4% in the previous month. Analysts had expected a slowdown but more moderate (4%). And now the 5% target set by the Beijing government for 2023 is at risk.

If these figures can make the West smile, where even a percentage point is enough to speak of “good” growth, if not “solid”, in the Asian giant, the second largest economy in the world after the United States, to fall below the threshold of 5 % means not being able to ensure a job and a salary for all those entering the labor market.

An alarming situation also for the rest of the world: a few days ago the American president Biden had called it “a time bomb”.

So much so that the data on youth unemployment, which has grown sharply in the last twelve months, has now become so “sensitive” as to push President Xi Jinping to keep them secret after months ago, young graduates were officially “advised” not to to be “squeamish” and to be satisfied even with “manual occupations” not in line with their preparation. Now, however, with youth unemployment at 21.3% (last figure for June), even these exhortations appear optimistic.

Today’s dismal figures are released as markets closely examine real estate, which along with construction has long accounted for a quarter of China’s GDP. The business has been hurt in recent months by the setbacks of some promoters with astronomical over-leveraging, the decline in consumer confidence and the global economic slowdown, which is weighing on the demand for Chinese goods and therefore on the activity economic. To support growth, the People’s Bank of China, the Chinese central bank, today lowered the reference rate for medium-term loans, a move that lowers the funding costs of banks to encourage them to grant more credit and on more favorable terms by cutting it to 2.65% against the previous 2.75%, already lowered in June.

China, faced with data coming out of its statistical offices, can only admit that its post-Covid economic recovery is “tortuous”. But he also assures that those who, especially in the West, are criticizing Beijing’s braking will be “proven”. These are the words of the Foreign Minister’s spokesman, Wang Wenbin, who, in a press conference, admitted that the economic recovery, after the prolonged closures, “will be a bumpy and tortuous process”, but he also defended himself: Western critics , he said, “they will certainly be proved wrong.” “Some Western politicians and media have emphasized the recurring problems of China’s economic recovery process after the Covid epidemic”, concluded Wang, turning Chinese economic problems into a political issue.

Perhaps not surprisingly, tension has resurfaced over the Taiwan issue with Defense Minister Li Shangfu, in his speech yesterday at the 11th Moscow Conference on International Security, returning to attack the West, without naming him. Attempts “to play with fire on the Taiwan question” or to use it to contain China “are doomed to fail”, Li said among other things, adding that Taipei is “a matter of internal affairs” of Beijing which ” it does not allow external interference”, and assuring how “the reunification of China” is “a historic trend”.

August 16, 2023 (change August 16, 2023 | 12:41)

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