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Chinese economy stabilizes with still greater business opportunities: expert

Xinhua | Updated: 2019-07-17 16:52
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A technician works on the production line of a machinery company in Luannan county, Hebei province. [Photo/Xinhua]

SAN FRANCISCO - For companies and investors eyeing China for opportunities, brighter prospects remain ahead even at the current slower growth rate, a senior economic expert said, in reference to China's freshly-released H1 economic report.

China's gross domestic product grew 6.3 percent in H1 year-on-year, according to the report from the country's National Bureau of Statistics published on Monday.

The rate, significantly slower than the 9.4 percent a decade ago, in fact registered greater incremental expansion since the base today is 182 percent larger, said Andy Rothman, investment strategist at San Francisco-based investment firm Matthews Asia.

"The incremental expansion in the size of China's nominal GDP would be 130 percent bigger than the expansion 10 years ago at the faster pace. As a result, opportunities for companies and investors are greater at the currently slower growth rates," he said in an article published on Monday.

The investment expert said China's domestic consumption and services, the bulk of the economy, remain healthy to stabilize employment despite sluggish growth in manufacturing, investment and export.

Moreover, the Chinese government seems prepared to handle the slowdown and prudently shun stimulative monetary and fiscal policies.

The Shanghai Composite Index was up 18 percent from the start of the year through to July 15, which also speaks to a positive investors' attitude towards the Chinese economy, he noted.

The analyst attributed the second quarterly slowdown to dual anxieties: one is trade frictions with the US, the other is the "Chinese government's ongoing campaign to reduce risks in the financial system."

"Chinese consumers aren't very worried by the Trump tariff tantrum because this is the eighth consecutive year in which the (tertiary) services and consumption sector is the largest part of GDP," he noted.

Nominal retail sales remain healthy, income growth is robust, and the growth for per capita disposable income keeps almost flat year-on-year.

"China remains, in my view, the world's best consumer story," he said.

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