January 13, 2006
When 20% Growth is a Correction
An article today about the state of China's property market that I found more worrying than breathtaking. The National Development and Reform Commission has said that it expected property sales in China to only increase 20%, and that the market had been in a correction since mid-2005. Allow me a quote:
It expects the growth in property investments in China to slow to 16 percent this year, compared with a projected growth of 21 percent in 2005 and an actual growth of 28 percent in 2004.
It expected this 'correction' to cause non-performing loans to rise, liquidity pressure, and for weaker property players to be weeded out.
Yet 20% is very respectable almost anywhere else in the world. What's going to happen to China when it faces a real correction?posted by HK Dave on 01.13.06 at 12:37 PM in the China economy category.
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