China’s Economy Grew 8.1% In 2021, Slowing Down In The Second Half
January 17th, 2022
China’s economy expanded by 8.1% in 2021, but the country is facing pressure to support activity after the ruling Communist Party forced the huge real estate industry to reduce its growing debt. This was reported by the Associated Press.
China’s growth as the world’s second-largest economy fell to 4% from a year earlier in the last three months of 2021, government data on Monday showed. This is less than 4.9% in the previous quarter and an impressive 18.3% in the first three months of 2021.
Analysts warn that the weak development will continue this year due to new outbreaks of coronavirus and debt reduction. This could have global consequences, lowering demand for steel, consumer goods, and other imported products in China.
The Celestial Republic recovered quickly from the pandemic, but activity slowed as Beijing tightened control over real estate lending, leading to a decline in construction that provided millions of jobs. This has heightened consumer concerns about costs, as well as financial markets’ concerns about possible defaults by developers.
“The pressure to reduce growth will continue in 2022,” said Tommy Wu of Oxford Economics in a report. According to him, the government is likely to provide “political support” to keep annual growth above 5%.