China the world’s second-largest economy behind the US reported economic growth of 6% in the third quarter which missed the expectations of the analysts. The prediction is that the coming quarter which is the last quarter this year would also be difficult for China.
China’s state-owned companies stated that the profits in the first three quarters grew from 7.4% a year ago to 8.6% in the first half of this year. It was still unclear as to how much profits have changed in the third quarter. A clear picture of the private companies may come out by the end of this month. Add to that the trade tensions that are going on between Beijing and Washington. China has come out with some measures to reduce the dependence on debt for growth. There have been other measures taken as well like rate cuts, and the encouragement to lending the private companies. But all this has yet to show a significant boost to the economy.
Due to the structural adjustments in the economy, China had to make due to the trade tensions with the US the current state of the economy is not as good as last year. Experts believe that there have been some improvements from the first half of this year which was the worst. Experts believe that more focus should be given on maintaining a stable business environment in the country for formulating new government policies which will have a much better effect on the economy in the long run.
Some officials are also highly optimistic that a trade agreement in the fourth quarter would improve the economic condition of the country. But whether a trade agreement between the two countries would happen so quickly is something to watch for.