Economic Growth Has Been Improving
The country's economic growth hit a more than three-year low of 7.4% in the third quarter from July to September. But recent data have fueled optimism that the worst is over. Exports, industrial production, retail sales and fixed asset investment -- a key gauge of infrastructure spending -- have all shown improvement.
Premier Wen Jiabao and Commerce Minister Chen Deming have both said in recent months that they expect China to achieve its targeted 2012 growth rate of 7.5% despite the impact of the global slowdown.
The rosier outlook comes as China concluded an overhaul of the ruling Communist Party's top leadership in mid-November. Vice President Xi Jinping took charge of the party from President Hu Jintao, whom he is also expected to replace as president in March.
China cut interest rates twice this year and decreased the amount of funds banks must keep in reserve three times since December last year to encourage lending.
It has avoided the type of major initiatives it took after the 2008-2009 global financial crisis, including a government-driven stimulus package worth about half a trillion dollars. But it faces mounting pressure to restructure its economy to ensure long-term growth, such as reducing its reliance on investment and boosting domestic consumption.
"Whilst things are stabilised in the short term -- that means maybe six months, a year even, we don't expect there to be any dramatic slowdown -- the bigger picture remains that the Chinese economy is slowing," said Thornton.
"I think the focus now has been pushed out to assessing how China's going to deal with reform."
Copyright Agence France-Presse, 2012
