Published By : 21 Dec 2018 | Published By : QYRESEARCH
The economic growth of China is expected to slow to around 6.2 percent by the end of 2019, which was around expected to be 6.5 percent in the current year. The slowdown in this growth is due to the headwinds rise due to their trade dispute among China and the United States, states the World Bank in a new report that was recently published on Thursday. Its outlook on the economic growth of China in the year 2018 is likely to be one of the weakest in the last 28 years and has remained unaffected from its estimation in the month of April.
Furthermore, the key policy challenge of China is to perfectly manage the trade-related headwinds by maintaining the efforts in order to limit the financial risks, the bank added in their latest assessment on the second-largest economy in the World. In addition to this, the consumption is likely to remain the main driver of the China’s economy as the low credit growth weighs on the investment. In addition, the slowing overall demand and the rising U.S. tariffs on the shipments take a toll on the exports, states the report.
In addition to this, to stimulate the economy the fiscal policy is estimated to focus on boosting the household consumption in comparison with the public infrastructure. Also, China also has the space to lower the business taxes. The government has further decided to cut down on the taxes quite extensively in the next year. This expected to spur a debate among most of the Chinese economists if Beijing should expand their fiscal deficit ratio further 3 percent by the end of the next year.