According to the report by Schroders “internal consumption e trend structural will drive growth “in Beijing
“The sharp deceleration of the Chinese economy, which began in the second half of 2021, yes Fr.it will also rotate in 2022; therefore the GDP growth will remain modest and we have therefore revised growth estimates of GDP since 7.7% to 4.7% in 2021“. The experts of Schroders nell’Outlook 2022 on China in which they predict that internal consumption and structural trends will drive growth and underline how, after the last correction, the stock market offers some opportunities.
Given the policy of zero tolerance against Covid-19, the restrictions they will continue to weigh on economic activity, particularly in the service sector. The government intervened to support the energy sector after several blackouts had held back its activity. However, pressure on coal reserves is likely to remain, at least in the winter. Consequently, i producers have to contend with higher energy costs in a phase in which export demand seems destined to slow down, underlines the report of the investment house.
In any case, “la main source of concern is the industry of real estate. Skepticism about the solidity of highly indebted builders led to a marked reduction in sales of new properties; a fundamental source of financing has therefore disappeared and a vicious circle has been triggered characterized by a contraction in construction activity, debt restructuring more frequent and reduced turnover. It is however likely that at some point the authorities decide to take the helm in hand to stabilize the situation, in order to avoid potential negative consequences of a collapse of the residential market “, write the experts of Schroders.
Another hot topic is obviously theinflation, con i producer prices which are expected to peak in 2022. Additionally, some consumer goods producers – buoyed by brand strength – may be able to transfer the higher production costs to final consumers. Therefore, thenext year may turn out to be more auspicious for the shares of high-quality consumer goods companies. “We expect growth to be concentrated mainly in strategic areas such as new infrastructures and capital investments in green projects, in line with government policies”, continue the experts.
“On the other hand, it is a further slowdown in real estate investments is likely given the deleveraging in progress on the real estate market “, concludes Schroders, according to whom” the correction of the Chinese stock market in 2021 gives rise to numerous opportunities in various sectors. Overall, it seems to us that the ratings are adequate and offer higher downside risk protection in a macroeconomic context that is still difficult in 2022 “.