China’s property sector shrank at a faster pace in the final three months of last year as the country’s housing slump continues to take its toll on the economy.
Output in the real-estate sector shrank 2.9 percent in the fourth quarter after a 1.6 percent contraction in the previous three months, the Chinese National Bureau of Statistics said yesterday in a supplemental report on GDP.
That was the first consecutive quarterly decline since 2008.
The construction sector’s output also declined by 2.1 percent during the same period.
Those two sectors combined were 13.8 percent of national output last year, Bloomberg calculations showed, lower than the 14.5 percent in 2020.
Despite authorities’ efforts to ease some restrictions on real-estate funding, China’s property market slump persisted last year, with the downturn spanning developers’ sales, investments, land purchasing and financing activities.
Property investment last month shrank 14 percent from a year earlier, Bloomberg calculations showed. For the full year, it grew 4.4 percent.
China’s economy in the fourth quarter of last year grew at the weakest pace in more than a year, weighed down by the housing slump and weak consumer spending, data released on Monday showed.
GDP expanded 4 percent from a year earlier, down from 4.9 percent in the previous quarter.
The Chinese National Development and Reform Commission said that the country has “relatively plenty” policy tools in reserve to cope with a challenging year ahead and that it would roll out these measures in a timely manner to stabilize growth.
Commission spokesman Yuan Da (袁達) told a news conference that the government would quickly roll out policy measures to boost domestic demand and study targeted measures to bolster industrial production.
The world’s second-largest economy rebounded last year with its best growth in a decade, helped by robust exports, but momentum is slowing on weakening consumption, weighed down by repeated COVID-19 outbreaks and a property downturn.
“We will continue to step up monitoring and forecasting of the economy, and study the policy tools in reserve, and roll out timely, relevant policy measures based on the need from the economic operations to ensure a stable, healthy and sustainable economic development,” Yuan said.
The Chinese central bank on Monday unexpectedly cut the borrowing costs of its medium-term loans for the first time since April 2020, with some market analysts expecting more policy easing this year to cushion an economic slowdown.
Yuan said that the economy faces many challenges this year, including weak consumption, constrained growth in investment and uncertainties in foreign trade, which have led to fluctuations in market expectations and corporate confidence.
The regulator approved 90 fixed-asset investment projects last year, worth a total of 775.4 billion yuan (US$122.20 billion).
Additional reporting by Reuters
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