China is now comfortably on track to meet its growth targets after the country reported GDP growth of 6.9 percent in the second quarter of 2017, compared with the previous year. The figure beat analyst expectations, and sets China on the path to post its first year-on-year acceleration of growth since 2010.
As reported by the Financial Times, China’s GDP growth last year was 6.7 percent, while the government is targeting a full-year growth rate of around 6.5 percent for this year. The string of growth will set the groundwork for the government to tackle economic challenges ahead of the re-selection of China’s Central Committee later this year.
Overall, the surge over analyst expectations was driven by three main factors. As reported by Bloomberg, industrial output rose by 7.6 percent from a year earlier after it was estimated it would only grow by 6.5 percent. Property also performed strongly, with fixed-asset investment climbing 8.6 percent in the first half of the year. Retail was another bright sport, jumping by 11 percent from a year earlier.
China’s GDP growth last year was 6.7 percent, while the government is targeting a full-year growth rate of around 6.5 percent for this year
However, there are still some challenges for the Chinese economy in the near future. There is fear that growing debt in the manufacturing sector could combine with overcapacity to drag the economy down, and there are also worries that large cities are currently in the middle of a property bubble. Total debt in China is approximately 277 percent of the country’s GDP, a figure that will need to be gradually reined in.
“Overall, the economy continued to show steady progress in the first half…but international instability and uncertainties are still relatively large, and the domestic long-term buildup of structural imbalances remain,” a statement released by China’s National Bureau of Statistics said.
As reported in the latest edition of World Finance, China’s manufacturing sector is currently in the process of modernising and adopting more hi-tech systems to compete on the world stage.