BOFIT Forecast for China 2017–2019 / 2

Abstract

China’s economic growth has picked up from last year. Official figures show GDP rose by 6.9 % p.a. in the first half of 2017, but with the expected slowing towards end of the year, growth for this year should come in at around 6.5 %. In 2018 and 2019, economic growth should keep slowing gradually as China pulls back from debt-financed stimulus policies to a more sustainable framework. This gradual slowdown is, above all, a natural evolution for China’s economy that reflects on-going structural changes. The financial market risks are elevated and pose a risk to economic growth – and even more so if China continues to push the economy to the 2020 growth target with stimulus policies. Uncertainties related to Chinese statistical data have made it even more difficult to evaluate economic trends.