China’s economy grew more than expected in the third quarter, data showed yesterday, but officials continue to face calls for more stimulus while struggling to contain a property crisis.
The 4.9 percent annual expansion in the July-to-September quarter was helped by forecast-beating retail sales figures, but it was still slower than the 6.3 percent expansion in the second quarter.
Analysts in an Agence France-Presse poll expected a 4.3 percent increase last quarter.
Photo: EPA-EFE
On a quarterly basis, GDP grew 1.3 percent in the third quarter, accelerating from a revised 0.5 percent in the second quarter.
Authorities are still on edge over turmoil in the real-estate sector, which has long accounted for one-quarter of the country’s GDP, supports thousands of companies and is a major source of employment.
The country faced a “grave and complex international environment and challenging tasks in promoting reform, development and stability at home” in the first three quarters of this year, the Chinese National Bureau of Statistics said.
Data showed that retail sales, the main indicator of household consumption, rose a better-than-expected 5.5 percent year-on-year last month, while industrial production growth was flat at 4.5 percent in the month. Urban unemployment dipped to 5.0 percent from 5.2 percent in August.
The IMF yesterday called on China to implement a “comprehensive strategy to address problems in the real-estate sector.”
“China’s weaker near-term growth outlook will weigh on regional growth,” it said, adding that the country’s debt-burdened property sector would be a drag on demand across the region.
Analysts said the improvement in third-quarter economic data makes it less likely for the Chinese government to launch stimulus in the fourth quarter.
However, China’s high levels of corporate and local government debt, often seen as unsustainable, pose a risk to the economy, they said.
Meanwhile, trade tensions with Washington as well as an aging population were long-term structural impairments that could affect China’s economy, they added.
“The economic recovery is still in its infancy,” Moody’s Analytics economist Harry Murphy Cruise said. “Direct support for households could be the aspirin needed to shake the property hangover, but such support looks increasingly unlikely.”
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