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Economist: Steady GDP growth achievable this year

By Xinhua | China Daily | Updated: 2017-02-16 07:03

China is capable of achieving steady GDP growth this year despite global uncertainties, according to Standard Chartered Bank.

"We expect China to continue to set its GDP growth target at about 6.5 percent for 2017, and the world's second-largest economy could grow by 6.6 percent this year," said Ding Shuang, chief greater China economist at Standard Chartered.

Ding noted that US policies toward China and elections in post-Brexit Europe might complicate the international environment for the Chinese economy, while domestic slowdowns in the property and automobile markets might drag on consumption growth.

Economist: Steady GDP growth achievable this year

China's real estate market will see a slower sales pace as tightened regulations have an effect, while sales of passenger cars have shown signs of contraction, down by 1.1 percent year-on-year in January.

However, Ding said that other engines of economic growth were gaining steam in China.

He said that the service sector will grow faster this year as Chinese demand better entertainment, healthcare, education and travel experiences, which could contribute to about 60 percent of GDP.

Meanwhile, China's exports seem to be regaining momentum after a subdued performance last year. The country's foreign trade volume beat market expectations to grow by 19.6 percent year-on-year in January.

In addition to a lower comparison base and effects from Spring Festival, the global economy is showing positive signs, as the latest purchasing managers index figures in the United States and some European countries showed growing factory and service activities, according to Ding.

He added that the yuan's previous depreciation would gradually help lift exports.

Ding said that to sustain steady growth at about 6.5 percent, China would still have to combine effective policy tools.

"While China decided to take a prudent and neutral monetary stance, the government needs more proactive fiscal policies to help prop up growth," Ding said. "China's debt level is still controllable, and the government can lift the fiscal deficit-to-GDP ratio from 3 percent in 2016 to 3.5 percent this year."

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