2023-08-16 19:22:50
The Chinese government is aware that the recovery of its economy will be “torturous” but denounces that Western politicians and media are exaggerating the economic difficulties that the country is going through by questioning the ability of the Asian giant to continue acting as engine of the world economy. “A small number of Western politicians and media exaggerate and exaggerate the periodic difficulties of China’s post-epidemic economic recovery. In the end, the facts will prove them wrong,” the spokesman for the party said on Wednesday. Ministry of Foreign Affairs of China, Wang Wenbin, at a regular press conference.
The truth is that concern about the weakness of the second largest economy on the planet is spreading falls in world stock markets. The American President, Joe Bidenconsidered last week that the slowdown in the Chinese economy, of which the United States is the main rival, is “a time bomb” for global activity.
Weakness on all fronts
One day after the Bank of China decided to cut interest rates to 2.5% to stimulate its economy, the Chinese spokesman for Foreigners has acknowledged that “China’s economic recovery (post-Covid) will have to navigate on the waves and experiment a winding journeyinevitably with difficulties and problems”, however -he added- “we have never retracted from the problems, we have taken proactive measures to address them and the results have been or are being seen.
The weakness shown by recent Chinese economic indicators, such as those related to the retail salesconsumption, employment, lending, industrial production, real estate activity o Consumer confidence has led the Asian government to announce shock measures. “The latest data is disappointing and shows that, after a good start to the year, activity plummeted from April. We did not expect the ‘sugar rush’ of reopening [post-covid] last long, as households had not accumulated large savings during previous lockdowns. However, we assumed that it would continue into the second quarter,” which has not happened, sums up David Rees, chief emerging markets economist at Schroders.
The Central Bank of China is being forced to intervene to stop the yuan’s slide against the dollar (after weakening by around 5% since the beginning of the year). For its part, the ghost of the real estate crisis due to the setbacks of several heavily indebted developers is still alive, while the Chinese government has been forced to deny the deflation risk after the consumer price index (CPI) entered negative territory in July, with an annual fall of 0.3%. “There is no risk of deflation in China now or in the future,” said Fu Linghui, a spokesman for the National Statistics Office (ONE), who, however, also acknowledged that the country’s economic recovery “faces several challenges “.
If China sneezes…
Related news
The latest indicators released indicate that China may struggle to reach its 5% growth target this year, as expansion between the first and second quarters was 0.8%.
“If China sneezes, the rest of the world catches a cold; any data point that shows the Chinese economy is not doing well is a negative for global markets, particularly Europe, in terms of consumer demand from China,” Michael Field said. , Morningstar’s European equity strategist, in a comment quoted by Reuters.
#China #denounces #West #exaggerates #difficulties #economy