Is China's growth about to slow down?
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With bank lending and industry growth slowing, trade surplus, fixed asset investment and Purchasing Managers Index declining, demand for electricity decreasing and stock markets and house sales falling, many worry that China's economic growth will face big challenges in the second half of the year.
In recent years some people and media have tended to magnify a single economic datum or a single economic phenomenon. Once something negative appears in the economy, they think it is collapsing. Their overestimation of the economic uncertainties and risks may mislead the governments to make inappropriate judgments and decisions.
For instance, the judgment of the property market for the second half of 2008 was a result of such misleading estimation. China's property market was on a healthy path at that time. But due to the exaggeration of the deceleration of the housing market, the government issued the No. 131 Document in an effort to keep the market strong, which blew up a housing bubble in China.
So in order to make a proper assessment of the nation's economic situation, one needs to take a tour across China, from first tier cities to isolated mountain villages, from countryside to factories, from north to south. No one can doubt that China's economy is booming.
Investment, export and consumption, as the three driving forces of economic growth, have been performing very well.
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