Chinese economy to dodge hard landing: expert

2012-12-11 10:25:19 GMT2012-12-11 18:25:19(Beijing Time)  Xinhua English

The Chinese economy will not witness a hard landing, Stephen Green, head of Greater China research at Standard Chartered Bank, said Tuesday.

The government projects, credit and the real estate sector are the three main leading indicators to forecast China's economy, Green said while addressing a seminar held by the Hong Kong General Chamber of Commerce.

He said data show that both the central and local government projects are going up this year, compared with the dropping trend since around 2008, and at the same time, the real credit sector also sees the growth, implying the investment activity will pick up.

Green said the credit growth has been allowed to accelerate this year, with the economy beginning to turn around at the some point, "so we did not think there will be a hard landing (for China's economy)".

Citing the data in cement production and real credit growth in China for example, he said the two figures go hand in hand, indicating the credit recovery is triggering a real economy recovery in the end.

In terms of the real estate sector, Green said the housing transactions are on the rise, and China's housing market has "recovered significantly," adding that the housing market tends to drive consumption as the buyers will "by a car, a nice TV and other furniture" following the purchase of the property.

In addition, when talking about China's banking sector, Green expects many of the small loan companies will probably be allowed to become banks in the next five years, and thousands of the deposit-taking institutions run by private entrepreneurs will be happy to lend money to small and medium-sized enterprises legally.

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Editor: Yu Runze
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