Is China facing a “cataclysmic” economic slowdown? – UOB

By FXStreet FXStreet (Guatemala) – Analysts at UOB Group explained that China will use market solutions to ease its overcapacity woes and will not use investment stimulus to expand demand, Premier Li Keqiang said during a recent visit to northern Shanxi province, Beijing News quoted Li as saying.

Key Quotes:

“China will face great difficulty in achieving economic growth above 6.5% over the 2016-2020 period due to slowing global demand, rising labor costs at home, and growing environmental concerns, the China Securities Journal on Mon quoted Li Wei, president of the State Council’s Development Research Centre, as saying at a conference over the weekend.

China is not facing a “cataclysmic” economic slowdown and last week’s market turmoil was more about badly designed stock market circuit breakers, said Nobelprize-winning economist Joseph Stiglitz in an interview in Shanghai.

Stiglitz said the Chinese government’s new focus on supply-side economic reforms could precipitate a deeper downturn if not accompanied by measures to boost demand. Policy makers plan supply-side reforms to deal with issues including overcapacity and excess labor in state-owned industries.”
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Source:: FX Street