(Finance) – It is probable that economic growth in China will slow in the coming yearsweakened in particular by the uncertainties linked to one unprecedented real estate crisis and from the international context. She said it today International Monetary Fund. The country’s GDP will stand at 4.6% this year and will fall to +3.5% by 2028. In 2023, China’s GDP rose by 5.2% in 2023, just above the target set by Beijing, but the real challenge is expected in 2024.
“A more severe than expected contraction in the real estate sector could further weigh on demand and worsen confidence, amplifying local authorities’ strains on public finances and leading to disinflationary pressures and adverse macro-financial spirals,” the study says, according to a statement .
At the same time the IMF published a China real estate analysis report which for decades has been an engine of economic growth and accounts for about 20% of activity in the economy. But since 2020 the sector has started to suffer a contraction and according to the study this is a long-term trend, because in the next 10 years investments in the real estate sector are expected to fall between 30 and 60%, compared to 2022 levels.
In the most recent phases China’s economic recovery was supported by domestic consumption. Looking more at the medium and long term, according to the IMF, growth should slow down, reflecting a moderation in productivity and the aging of the population. GDP growth is expected to be 4.6% this year, 4% next year, then 3.8% in 2026, 3.6% in 2027 and 3.4% in 2028.
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