Last year’s growth figure was well below the 7.3 per cent recorded in 2014, and the AFP survey projected it would fall further this year, to 6.7 per cent.
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Other industrialised economies would find little to complain about if they enjoyed growth figures approaching those released on Tuesday, but in the Chinese context the data are cause for concern.
Julian Evans-Pritchard, China economist at Capital Economics, warned against taking official GDP figures at face value but believed growth does appear to have been broadly stable last quarter.
China’s economic growth in the fourth quarter slowed to the weakest since the financial crisis, adding pressure on a government that is struggling to restore the confidence of investors after perceived policy missteps jolted global markets. The services sector grew 8.2 per cent in real terms in the fourth quarter versus 6.1 per cent for the industrial sector.
The Chinese leaders have been making great efforts to stop the slow down as a new plunge in the stock markets of the company and the yuan currency takes a dip. Economists had expected 6.9%.
However, Premier Li Keqiang has said a slower growth rate would be acceptable, as long as enough new jobs were created.
Professor Hu Xingdou from the Beijing Institute of Technology said the official figures provided a more optimistic view than the actual situation in China.
Viewed against an worldwide backdrop, a 6.9 per cent growth was “not a low rate” and outshined other global economies, Wang said, defending it as a hard-won achievement.
Fixed assets investment gained 10% for the year, which was also below expectations and the prior reading (both 10.2%). In 2014 however, the country’s economic growth stood at 7.3 percent. In a press release, the statistic agency said slower growth reflected a “complicated worldwide environment and increasing downward pressure on the economy”, but was in line with plans for “moderate and sound development”.
China’s services sector accounted for 50.5 per cent of GDP in 2015, the NBS said in a statement, the first time it was more than half the economy.
China has cut interest rates six times since November 2014, and lowered the amount of cash banks have to set aside as reserves.
Zhao Yang of Nomura reiterated the bank’s 5.8 percent forecast for 2016 due to “strong headwinds” and overcapacity in manufacturing, along with an excess supply of property.
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Those results fell short of economists’ expectations, according to a survey by Bloomberg News, which predicted a year-on-year increase in retail sales of 11.3%, while industrial production was projected to expand 6%. The real estate sector is showing some recent signs of improvement as home prices in bigger markets, like Beijing, Shanghai and Shenzhen, have picked up.
