Market growth slows in China
Is moving from being a manufacturing country to a consumer-driven one
China is entering a period of slower economic growth as the country moves from being a manufacturing country to being a consumer-driven one, according to market analyst Euromonitor. This change will fundamentally alter global flows of trade in the long term, according to the analyst.
“As demographic shifts are threatening the country’s work force growth,” said Euromonitor, “slower global growth is forcing the Chinese economy to transition.“ A more consumption-focused growth path will slow real GDP growth to a more sustainable level, as returns on investment projects moderate.”
Despite this, Euromonitor added that China’s real GDP growth is likely to be lower than original expectations. The Chinese economy is expected to grow by 7.0% to 7.5%, compared with the country’s original target of 7.5% growth for 2013.
Overall, the Chinese economy grew at its slowest pace for 13 years in 2012, and in May, exports to its two principal markets, the US and the EU, both fell for the third month running.