24 March 2019
Premier Li Keqiang says China is confident it will reach its 7.5 percent growth target. Photo:AFP
Premier Li Keqiang says China is confident it will reach its 7.5 percent growth target. Photo:AFP

Li unruffled by IMF property crash warning

The IMF’s warning came on Wednesday. If China’s property prices go over a cliff, Alfred Schipke, the International Monetary Fund’s senior resident representative in China, said, the impact on the country’s economy will be strong.

A day later and half a world away in Nigeria, any ripples of alarm had yet to reach Premier Li Keqiang. Speaking in Abuja at the World Economic Forum on Africa Summit, Li underscored his message that China has the confidence and capacity to generate 7.5 percent growth in gross domestic product this year.

To be fair, Schipke said there’s so far no sign of a nationwide plunge in home prices, but the government should ensure they have the financial and monetary policies on hand to deal with risks, the Hong Kong Economic Times reported Friday.

China’s red-hot property market has shown signs of cooling in recent months as the wider economy has slowed. The number of new homes sold in major cities in early May was well down on March and April and the same periods over the past three years, the report said. Several lower-tier cities have been easing housing curbs.

Added into the mix is a World Bank projection that China will overtake the United States as the world’s biggest economy this year.

It projection’s release Wednesday largely prompted skepticism in China—even the National Bureau of Statistics, which took part in the study, “expressed reservations” about the study’s methodology and “did not agree to publish the headline results for China,” according to the World Bank report.

But the debate is mostly academic, Schipke said, with little relevance to actual living standards, according to a China Daily report. He added that there is huge room for improvement in terms of people’s well-being, the quality of growth, income inequality and environmental degradation.

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EJ Insight reporter

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