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Opinion | Behind loud headlines, China’s economy is quietly making strides
Recently, some Western media outlets have fixated on a few key challenges within China’s economy: the perceived fragility of the property sector, the weight of local government debt and the persistent issue of youth unemployment.
But this narrow view obscures a broader and more complex picture – a story of remarkable resilience, ongoing economic transformation and significant potential. While the challenges are undeniable and demand careful attention, they do not define the entirety of China’s economic landscape.
The property market, while facing headwinds and undergoing a necessary period of adjustment, is not in a state of collapse. Rather, it is experiencing a managed transition. The Chinese government has shifted its focus from the previous era of speculative, rapid growth to a more sustainable model that emphasises stability and affordability.
This transition, while challenging in the short term, is vital for fostering a healthier and more balanced property market in the long run. Data emerging this year provides encouraging indicators of a recovery trend. Proactive policy support from the central government, coupled with renewed market confidence, is contributing to a noticeable rebound in housing prices in major urban centres such as Beijing, Shanghai and Shenzhen.
Goldman Sachs, citing these positive trends, expects China’s housing prices to bottom out this year, and market confidence is gradually recovering. This evidence suggests the market is navigating out of its adjustment period.
The issue of local government debt, while a legitimate concern in certain regions, must be viewed with a more nuanced perspective. It is crucial to recognise this is not a uniform problem across the entire nation. Many local governments are displaying effective fiscal management, and the central government has established robust mechanisms to provide targeted support.
03:49
Rally cry by Xi sets economic priorities for Chinese officials, absolves them of mistakes
Rally cry by Xi sets economic priorities for Chinese officials, absolves them of mistakes
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