CCTV.com - CNTV English - CCTV News


Homepage > News > Biz >

GDP growth in Q1 of 2012 may below 8 pct: consulting report

11-24-2011 16:27 BJT

BEIJING, Nov. 24 (Xinhua) -- The risk of China's growth slowing to less than 8 percent in the last quarter 2011 and the first quarter 2012 is increasing due to the cooling property market and sluggish foreign demand, a recognized financial consulting service Nomura said Thursday.

China's economy is confronting a series of challenges this winter, which may lead to falling GDP growth, a report released by Nomura International (Hong Kong) Ltd. said.

The report cited the country's cooling housing market as a major reason for potentially slower growth, noting that the commercial housing market was experiencing a turning point and home sales as well as investments in the sector would further weaken in the next six months.

Since April 2010, China has imposed a raft of measures aimed at cooling property prices. The measures include higher down payments, limits on the number of houses that people can own, the introduction of a property tax in some cities and the construction of housing for low-income people.

Government data showed that 34 cities in a statistical pool of 70 major cities saw declines in new home prices in October, compared with 17 ones in September.

Prices of new homes in four major cities -- Beijing, Shanghai, Guangzhou and Shenzhen -- saw month-on-month price drops in October after staying unchanged for three months.

The report said investment in affordable housing before the second quarter of 2012 would be limited partly due to cold weather in winter, especially in north China.

Another reason is that the government has met its goal of starting construction on more than 10 million affordable housing units this year, the report said.

The State Council introduced in March a plan to construct 36 million subsidized housing units, including affordable homes, low-rent apartments, price-capped homes and public rental houses, in the coming five years.

China's housing authority announced this month it had realized the annual target of affordable housing construction by the end of October.

The report said that the slowdown in the housing sector is going to have a spill-over effect on the demand for steel and cement and other building materials. Subsequently, output of related industries is likely to grow at a much slower pace.

Approximately one third of the country's steel demand comes from the housing sector, and the rapidly increasing steel output in the past three years has largely been driven by the property sector, according to the report.

The slowdown of China's industrial output growth is already shown by the preview of the country's Purchasing Managers Index (PMI) data released Wednesday by the Hong Kong and Shanghai Banking Corporation (HSBC).

The HSBC reported that China's manufacturing PMI for November fell from October's 51 to 48, representing a 32-month low.

An index above 50 indicates expansion of the manufacturing sector, while an index below 50 suggests contraction.

"The decline of the PMI indicated that industrial output growth may fall 11 to 12 percent in the next few months," said Qu Hongbin, chief economist with HSBC China.

The Nomura report said that if China's economic growth really slows to less than 8 percent in the first quarter of 2012, the government might loosen its macro economic policies in a progressive manner.

After the first quarter, the country's economic growth would regain momentum from accelerating the construction of affordable homes and the government's possible loose macro policies, so the GDP growth for the full year of 2012 would still exceed 8 percent, the report said.

Editor:Wang Xiaomei |Source: Xinhua

Hot Videos view more

The celebrations are still continuing as the victorious coach, Joachim Loew, has been honored for his achievement in his hometown of Freiburg.
Germany coach Loew honored in hometown of Freiburg

Chinese men´s national team continued its preparations for next year´s Asian Cup, as they managed a one-all draw against visitors Jordan during a football friendly in Harbin, the capital city of Northeast China´s Heilongjiang Province.
China held to 1-1 draw by Jordan

The defending world champs came into the contest with a perfect 6-and-oh record, but they would be in for a tough first half before opening things up in the second.
USA beat Slovenia 119-76 in quarter-finals

Hot Stories more

UK authorities believe killer of James Foley is a British national

Across the UK the hunt is on for James Foley’s killer, who authorities believe is a British national. As Richard Bestic reports from London, Prime Minister David Cameron cut short his summer break to lead his government’s response.

Israeli war jets renews Gaza strike as truce talks stalled

Three Palestinians were killed and 40 others wounded in the intensive Israeli war jets´ airstrikes on the Gaza city on Tuesday night, shortly before an end of a 24-hour ceasefire in the Gaza Strip,

Missouri police arrest dozens after violent night

As the protests in the town of Ferguson, Missouri turned violent with police facing ´heavy gunfire´ from some ´criminal elements´, cops fired tear gas, stun grenades and arrested 31 demonstrators on Monday night.

Picture in news more

More Video News

Choose TV Program