*** Why Exactly is China GDP Growth Rate Slowing? ***

[Huan]

Hello PDF guys and gals,

I remember reading a few years ago that China would surpass the USA's total nominal GDP by year 2017/2018 but now I hear it would be beyond 2021? Not even in this decade????? And also now I hear that China's leadership will tolerate a GDP growth rate down to 6.5% for next year and beyond? To me that sounds like a D grade. Why don't mainland China try to maintain growth at 7%? Like maintain a C grade level of growth. Or even better, a B grade level of growth of 8%? To me, 6.5% sounds like a failing grade, below a C from a scale of 0%-10%.

Sometimes, I wonder if China's leadership under Xi Jinping is purposely trying to slow China down at this time to delay the timeline of surpassing America's nominal GDP? Why give the USA another couple of years to remain on top of the world nominal GDP scale? It is getting really really really boring to wait soooooooooo long for China to catch up. Seriously, work harder and faster please. Be serious in maintaining your GDP growth rate instead of putting on the breaks. Every time you (China) slow down by -0.5% or 1% it is adding another year for USA to wait for you (China) to catch up.

I am sitting here on the couch eating some hot-dog, hamburger, and french fries with a giant soda while America stomps all over the world with her economic and military might. LOL

How much longer will USA have to be on the top #1 nominal GDP position? Seriously, what is holding you (China) back?

 

[cnleio]

When world economy slow down, China export trade can't escape ... it's normal from GDP +7% reduce to GDP +6.5%, if we compared other nations their 2015 GDP growth, China as N.o2 GDP such growth indeed not bad.

If China surpass the USA's total nominal GDP ... there's a long way to go, even 2025 is uncertain.

 

[CHN Bamboo]

When world economy slow down, China export trade can't escape ... it's normal from GDP +7% reduce to GDP +6.5%, if we compared other nations their 2015 GDP growth, China as N.o2 GDP such growth indeed not bad.

If China surpass the USA's total nominal GDP ... there's a long way to go, even 2025 is uncertain.

Yes...During 2015-2025,it will be a hard time for China...
Economic transformation will be tough,but if not transform,our country won't go further.....
If we failed at last...
Okay,then there will be a new failed state.

 

[Economic superpower]

Hello PDF guys and gals,

I remember reading a few years ago that China would surpass the USA's total nominal GDP by year 2017/2018 but now I hear it would be beyond 2021? Not even in this decade????? And also now I hear that China's leadership will tolerate a GDP growth rate down to 6.5% for next year and beyond? To me that sounds like a D grade. Why don't mainland China try to maintain growth at 7%? Like maintain a C grade level of growth. Or even better, a B grade level of growth of 8%? To me, 6.5% sounds like a failing grade, below a C from a scale of 0%-10%.

Sometimes, I wonder if China's leadership under Xi Jinping is purposely trying to slow China down at this time to delay the timeline of surpassing America's nominal GDP? Why give the USA another couple of years to remain on top of the world nominal GDP scale? It is getting really really really boring to wait soooooooooo long for China to catch up. Seriously, work harder and faster please. Be serious in maintaining your GDP growth rate instead of putting on the breaks. Every time you (China) slow down by -0.5% or 1% it is adding another year for USA to wait for you (China) to catch up.

I am sitting here on the couch eating some hot-dog, hamburger, and french fries with a giant soda while America stomps all over the world with her economic and military might. LOL

How much longer will USA have to be on the top #1 nominal GDP position? Seriously, what is holding you (China) back?

It will take a long term strategic view to surpass the West.

China must end the money gap and technology gap with the West. China need money to advance in technology.

 

[Guynextdoor2]

natural demographic shift. As the population stabilizes, real wages go up. This means that China can no longer be the factory of the world and will shift from export oriented to internally focussed economy. Will result in overall slowdown, but nothing to worry about I guess. The real worry should be on the population demographic. One Child policy for such a long time means a lot of pressure on the grown up kids who will have to take care of two parents.

 

[大汉奸柳传志]

But why should WE work harder？I was kinda hoping another recession hit you folks and we claim the No.1 spot automatically.

 

[Edison Chen]

（it should be CNY, not USD）

It's interesting that developed regions are not slowing down at all, however less developed inland and west provinces are doing relatively not very well with a few exceptions like Guizhou, Chongqing and Hunan. Look at nominal GDP growth rate of the provinces, developed or costal provinces are still growing as fast as a beast:

Jiangsu 12.18%, Guangdong 9.13%, Tianjin 10.99%. These provinces have realized industrial structure reform from natural resources, foreign capital or cheap labor intensive economies (Shanxi's coal resources for example) to high tech innovation and consumpiton driven economies. When deflation comes, commodity prices of raw materials will fall, those who rely too much on natural resources or heavy industries cannot keep a sustainable growth from endogenous power, just like Hebei -1.98%, Shangxi -1.17%, Inner Mongolia 3.28%, Liaoning 0.21%, Heilongjiang -2.18%.

Inland cities/provinces like Chongqing and Guizhou also did very well, grows at 18.44% and 16.63%, pls also note that Guizhou is one of the poorest provinces in China. And Tibet nominal growth rate is 12.20%.

 

[AndrewJin]

When the growth of productivity per capita slows, the momentum of GDP growth(industry) slows. Radical changes should be made on technology and economic structures.

It is low, which means there is still much room.

Consumption is of course important.
If u look at the service sector and consumption, the growth is much higher.

China October Retail Sales: Strength In Ecommerce
Summary
October retail sales +11%, driven by strong ecommerce sales, growing at roughly +40% y/y.

Jewelry and apparel remain weak, but selective growth ideas remain NKE and TIF.

Ecommerce, the bright spot; BABA remains a top pick.


China released its October retail sales that showed continued progress as the country moves from an export/manufacturing-driven economy to a consumption-driven economy. I ultimately see this to be a positive for many of the Chinese stocks I have highlighted before, specifically Alibaba (NYSE:BABA), Tencent (OTCPK:TCEHY) and Ctrip (NASDAQ:CTRP), as well as US companies such as Nike (NYSE:NKE), Tiffany (NYSE:TIF) and Coach (NYSE:COH) that have strong exposure to the market. I remain bullish on Chinese equities and continue to see many to be undervalued given their long-term growth outlook.

October retail sales of Rmb2.8trn($0.44 trillion) was a +11% growth from the prior year and ahead of consensus estimate of +10.9%. This is a slight acceleration from the September growth of +10.9%, suggesting continued strength from the Chinese consumers and that China's transition towards a consumption-driven economy remains on track.

Gold and jewelry sales grew +4%, decelerating further from +6.5% in September and a sharp decline from +11.7% a year ago. The near-term outlook for gold and jewelry will likely to remain weak due to the lack of demand, but long-term outlook could improve as luxury spending accelerates. As such, I am still positive on TIF given its superior brand advantage over the local rivals. As for apparels, the +10% growth was an acceleration from the prior year, but still below last year's. However, it is important to be selective in this space, and I continue to favor sports, which is why I am quite positive on NKE's outlook.

 

[cnleio]

Yes...During 2015-2025,it will be a hard time for China...
Economic transformation will be tough,but if not transform,our country won't go further.....
If we failed at last...
Okay,then there will be a new failed state.

Here Mr Leio provide some maps to prove why China economy growth is much better than most West developed nations, usually the data from Leio is worth for reading and save our time for trolling. Until to 2015 China is the GDP fastest growth country (World Economy Engine) and the biggest consumer (World Buyer ) in this world !

China not just a World Factory, Today China is an Economy Beast, Yes we are ~!

IMF 2015 Forecast - China Largest Contributor To Global GDP Growth... Even At A 7% Rate

China's GDP Growth: An Important Rebalancing Milestone

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China GDP and Economic Data

 

[Huan]

When world economy slow down, China export trade can't escape ... it's normal from GDP +7% reduce to GDP +6.5%, if we compared other nations their 2015 GDP growth, China as N.o2 GDP such growth indeed not bad.

If China surpass the USA's total nominal GDP ... there's a long way to go, even 2025 is uncertain.

What about during the Great Recession in 2008? At that time, the US GDP growth rate was slowing and going negative and adversely affecting the whole global economy, but China's GDP at that time was able to grow close to 10% in the year 2008-2011 afterwards. Why is it any different this time for 2015-2020?

 

[Abacin]

What about during the Great Recession in 2008? At that time, the US GDP growth rate was slowing and going negative and adversely affecting the whole global economy, but China's GDP at that time was able to grow close to 10% in the year 2008-2011 afterwards. Why is it any different this time for 2015-2020?

GDP Growth of China can be controlled by Chinese government by using large scale public investments such as highways, HSR, subways etc. However, the efficiency of these public investments can decrease. For example, the efficiency of Shanghai-Beijing HSR is clearly better than Xinjiang-Xian HSR. The trend of decreasing efficiency of public investments has forced Chinese government to do economic structuring, or finding a more efficient way, such as consuming for future growth.

 

[pher]

it all depends on how you look at it. by our current size, even 5 percent is already superfast.

 

[cnleio]

What about during the Great Recession in 2008? At that time, the US GDP growth rate was slowing and going negative and adversely affecting the whole global economy, but China's GDP at that time was able to grow close to 10% in the year 2008-2011 afterwards. Why is it any different this time for 2015-2020?

It's like in 2008 China GDP $100 growth rate 10% ... in 2015 China GDP $200 growth rate 7%, well the bottleneck of economy growth is here, but China is okay !

 

[AndrewJin]

It's like in 2008 China GDP $100 growth rate 10% ... in 2015 China GDP $200 growth rate 7%, well the bottleneck of economy growth is here, but China is okay !

As the second country reaching 10 trillion dollars, 5-7% is acceptable. If China can grow at 5-7% for another 10 years, it is another historic period as important as China growing at 10% for two decades as a relatively smaller economy.

 

[ChineseTiger1986]

When world economy slow down, China export trade can't escape ... it's normal from GDP +7% reduce to GDP +6.5%, if we compared other nations their 2015 GDP growth, China as N.o2 GDP such growth indeed not bad.

If China surpass the USA's total nominal GDP ... there's a long way to go, even 2025 is uncertain.

There is a quick way to surpass the US nominal GDP in less than 5 years; to switch to 2008SNA right now and to count those small business activities.