Home / Knowledge / News / Textiles / China's economic growth to moderate: World Bank
China's economic growth to moderate: World Bank
21
Apr '15
The World Bank’s East Asia and Pacific Economic Report April 2015 says China’s growth is expected to gradually moderate from 7.1 per cent in 2015 and 6.9 per cent in 2017, reflecting intensified policy efforts to address financial vulnerabilities and structural constraints and to make growth more sustainable.

According to the World Bank, the progress in rebalancing the sources of growth in domestic demand will remain gradual. Investment growth will continue to decelerate due to credit tightening and ongoing adjustments in the real estate sector. And economic growth will continue to evolve from an industrial to a services base. Both monetary and fiscal policy stance is expected to remain accommodative to limit risks of too rapid growth slowdown that could trigger disorderly adjustments in accumulated imbalances.

A slower pace of economic growth will bring slower household income growth and hence a deceleration, but not a stop, in the fall of rural poverty. Poverty is expected to decline further—poverty rates in rural areas are projected to decline from 6.4 in 2014 to 2.8 percent in 2017 (the World Bank poverty line of US$ 1.25/day).

The World Bank report warns that a failure to strengthen the vulnerabilities in the financial sector could leave the economy increasingly saddled with inefficient firms, bad loans and weaker financial institutions. This could reduce economic activity by undermining productivity growth and increasing capital misallocation.

Second, the housing sector might not bottom out, instead continuing to decelerate, further undermining consumer confidence and economic activity. Third, managing local government debt remains a challenge. While policy initiatives to refinance local government debt are targeted to address specific vulnerabilities, accommodative policies if not accompanied with structural reforms will make it more challenging to implement the policies necessary to shift growth to a more sustainable medium-term path.

China’s growth had moderated to 7.4 percent in 2014 as policy efforts to tighten credit growth, reduce overcapacity, internalise the cost of industrial pollution and harden budget constraints of local governments intensified last year.

On the supply side, week domestic demand and policy tightening in energy-intensive sectors continued to weigh on industrial activity. In contrast, services remained upbeat as the structure of economic growth continued to evolve from an industrial to a service base.

Average disposable income in urban households grew at real annual rates above 8 per cent between 2010 and 2012, but only at 4.9 per cent in 2014. Similarly, real growth in average net income in rural households went from 12.1 per cent in 2011 to 9.4 per cent in 2014. The combination of falling real urban wages with flat unemployment rates and growing migration indicates that the deceleration of the economy has translated into price (wages) rather than quantity (jobs) adjustment in urban labour markets.


Must ReadView All

'Requirement of polyester filament yarn is increasing'

Textiles | On 19th Jun 2018

'Requirement of polyester filament yarn is increasing'

The requirement of polyester filament yarn (PFY) is increasing as it...

Courtesy: SAC

Textiles | On 19th Jun 2018

SAC to release pilot of Higg Facility Social Labour Module

The Sustainable Apparel Coalition (SAC) will release this year a...

Courtesy: Tim Savage from Pexels

Textiles | On 19th Jun 2018

Da Lat begins construction of $50mn wool yarn factory

Da Lat Worsted Spinning Limited Company has begun construction of a...

Interviews View All

Top executives
Textile industry

Overall, Union budget 2018-19 is very balanced

Anshul Sood
Oceedee

‘Indian footwear market is nascent and largely a trend follower’

Dharmendra Shah
Ozone PB Spintex Limited

‘We have made huge investments to ensure quality yarn production.’

Liz Manning

<div><b>Liz Manning</b>, Business Development Manager at Catexel, has...

Kalai Selvi

Vidyashilp Academy in Bengaluru is the country's first Fairtrade School....

C Dhandayuthapani

MAG Solvics Private Limited was established in 1991 to design and develop...

Iago Castro Asensio
RCfil Distribuciones S.L.

Iago Castro Asensio, International Business Manager of RCfil...

Suresh Patel
Sidwin Fabric

Sidwin Fabric is a manufacturer and exporter of polypropylene textiles and ...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Pranav Mishra
Huemn

Designers Pranav Mishra and Shyma Shetty’s Huemn is known for its...

Aditi Somani
Aditi Somani

Aditi Somani specialises in luxury fusion wear with international cuts and ...

Nisha Chanda
Whistling Woods International School of Fashion

<div>A lack of upgraded courses in costume designing and fashion as per...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


June 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Advanced Search