Chinese President Xi Jinping signaled no change in direction for two main risk factors dragging down China’s economy—strict Covid rules and housing market policies—providing little lift to a worsening growth outlook. Know more:
Chinese President Xi Jinping signaled no change in direction for two main risk factors dragging down China’s economy—strict Covid rules and housing market policies—providing little lift to a worsening growth outlook.
Xi’s report “is by no means a sharp turn from the previous policy stance,” wrote economists including Larry Hu, head of China economics at Macquarie Group Ltd., in a Sunday report. “The party congress is about long-term target and strategy, not about short-term policy adjustment.” Healthcare and information technology shares gained, despite overall weakness in the mainland stock market.
Few economists expect a significant rebound or a relaxation of Beijing’s stance that the sector needs to be regulated more tightly. That’s despite the government trying to stabilize the housing market by telling banks to lend more to property developers and encouraging local governments to reduce restrictions on housing purchases.
Xi also said the country aims to have a GDP per capita on the level of a medium-developed country by 2035, words that have been used in China to refer to countries such as the Czech Republic and Slovakia. The speech signals a new phase of development “with more focus on productivity growth instead of capital expansion,” said Peiqian Liu, chief China economist at NatWest Group Plc.