Slamming the brakes on China’s GDP growth
David Brancaccio: Imagine if the U.S. Economy grew at 8.1 percent a year instead of the 3 percent we’ve been living with. But in China this means slower growth recorded in the first three months of the year.
Juliana Liu reports from Hong Kong.
Juliana Liu: China’s economy is growing at its slowest pace since early 2009. At that time, the slow growth was a result of the property market in America, and the resulting financial meltdown. Now, the worry is coming from China’s own property market.
In the last decade, Chinese real estate prices have risen by more than tenfold. That has angered many Chinese who feel priced out of the housing market. Fearful of street protests, the Chinese government has been trying to prick the property bubble and make homes for affordable to everyone.
Qian Liu of the Economist Intelligence Unit in Beijing says the resulting economic slowdown is good news.
Qian Liu: Now we’ve seen in the past few years a double digit almost 14 percent growth in the Chinese economy. That’s too high and that’s not going to be sustainable.
But some U.S. investors and Western companies that sell to China don’t agree. They want more growth from China, not less — bBecause if the Chinese economy slows further, they could lose their best customer.
From Hong Kong, I’m the BBC’s Juliana Liu, for Marketplace.
We’re here to help you navigate this changed world and economy.
Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.
In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.
Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.