Chinese Economic Growth Slows Down in Second Quarter, Unemployment Rate Rises
The Chinese economy experienced a modest growth of only 0.8 percent in the second quarter of this year compared to the previous quarter. However, in the first quarter, it had shown a growth rate of 2.2 percent. A concerning phenomenon is the increasing unemployment rate among young people, which reached a record high of 21.3 percent in June. Additionally, the real estate market in the country is highly divided, and exports have also declined. This information was reported by CNBC.
The ruling Chinese Communist Party expects a significantly more modest growth in the coming years. The party set a target of only five percent for the annual economic growth in 2023. This view is also shared by the rating agency S&P, which recently adjusted its estimates for Chinese economic growth in 2023. Analysts now expect the Chinese economy to grow by only 5.2 percent this year.
However, in the long term, the Chinese economy has shown much higher performance. From 1978 to 2022, it averaged a growth rate of nine percent. Nevertheless, some sectors of the Chinese economy are currently facing significant problems, with the real estate and construction industry being the most critical.
In the future, the American efforts to decouple from Chinese supplies of advanced semiconductors and other technologies could have a negative impact on the Chinese economy. Due to low construction of new properties and the resulting decline in land prices, developers in China are facing financial difficulties. Chinese banks are providing fewer loans,
What are the potential challenges and risks faced by the Chinese economy, such as the impact of US disengagement from Chinese supplies and the financial difficulties faced by developers in the real estate and construction industry
Chinese Economic Growth Slows Down in Q2, Unemployment Rate Rises
In the second quarter of this year, the Chinese economy experienced a modest growth of only 0.8 percent compared to the previous quarter. This is a stark contrast to the 2.2 percent growth rate seen in the first quarter. A concerning trend is the increasing unemployment rate among young people, which reached a record high of 21.3 percent in June. Additionally, the real estate market in China is highly divided, and exports have also declined. These findings were reported by CNBC.
The ruling Chinese Communist Party is expecting significantly more modest growth in the coming years. The party has set a target of only five percent for annual economic growth in 2023. This view is echoed by the rating agency S&P, which has recently adjusted its estimates for Chinese economic growth in 2023. Analysts now predict the Chinese economy will grow by only 5.2 percent this year.
However, in the long term, the Chinese economy has shown much higher performance. From 1978 to 2022, it averaged a growth rate of nine percent. Nonetheless, certain sectors of the Chinese economy are currently facing significant challenges, with the real estate and construction industry being the most critical.
Looking ahead, the United States’ efforts to detach itself from Chinese supplies of advanced semiconductors and other technologies could have a negative impact on the Chinese economy. Furthermore, due to a decrease in new property construction and subsequent decline in land prices, developers in China are encountering financial difficulties. Chinese banks are providing fewer loans, exacerbating the situation.
It’s encouraging to see that NSK’s industrial production has increased in the second quarter, but the concerns about the future remain worrisome.