IMF has said in its report that China's economy may remain stuck in economic slowdown.
China's economy, which is stuck in economic slowdown after Corona, is not expected to come out of this slowdown any time soon. The International Monetary Fund (IMF) has said in its report that the slowdown in China's economy will continue and the Chinese economy may remain stuck in economic slowdown till 2028. This means that China's economy is likely to remain stuck in economic slowdown for 5 years.
According to the IMF, China's economy is struggling due to low productivity and rapidly growing population. Due to this, last year the world's second largest economy saw the slowest growth in a decade. The IMF report estimates that due to weak production and population growth, the growth rate will decline to 3.5 percent by 2028.
Let us tell you that earlier a growth of 4.6 percent was estimated for this year. Reason for recession: There is a crisis going on in the real estate market of the country for a long time. China was once developing rapidly, but now it is drowning in debt. This could pose a threat to China's financial system. Property giant Evergrande has further increased this problem by taking a huge loan of more than 300 billion US dollars. A Hong Kong court has issued an order this week saying that the liquidation of Evergrande's overseas assets should begin. However, the company says that this decision of the court will not have any impact on its domestic liquidation.
The IMF report warns that the ongoing recession in the property sector may further impact private demand. Sonali Jain-Chandra, head of mission for China in the Asia and Pacific Department of the IMF, said that apart from property, there is a need for improvement in the medical sector. According to official data, China's economy grew 5.2 percent last year, exceeding the nominal target of about 5 percent.
Published – February 3, 2024, 06:49 IST
Money9 App for latest updates on personal finance download.