China's GDP grows 7.9% in Q1, slightly lower than market expectations

중국 2분기 경제성장률 7.9%…1분기보다 10%p 하락

China's economy grew a little more slowly than expected in the second quarter of this year.
7-point-9 percent year-on-year.
Major reasons for that include higher commodity prices and supply chain issues.
Experts say lower growth in China could affect South Korea's economic growth as well this year.
Seo Eunkyung reports.
China's economy is still growing, but at a slower pace than expected.
The country's National Bureau of Statistics reported that its gross domestic product increased by seven-point-nine percent in the second quarter compared to the previous year. That figure is about 10 percentage points lower than what the country registered in the first quarter.
However, experts say that the outstanding first quarter growth largely reflected how much the economy was harmed by the pandemic a year ago... and the slower on-year growth for the second quarter was somewhat expected.

"People did expect growth to slow down a little bit because China was withdrawing fiscal and monetary stimulus that they used during the coronavirus last year. And China had been having some problems with inflation, raw materials, commodities and decline in demand. For services because of the spreading coronavirus in some regional areas shipping backlogs, a rise in energy prices."

He said that China is still on track to achieve its target growth rate of six percent.
That is mainly because its retail sales in June jumped 12-percent on year, which indicates that the slower growth was mainly from supply problems rather than a lack of demand.
But should China's growth fall short of expectations, this could in turn affect Korea's economy.

"Korea's exports to China rose by 23.8% during the first half of this year. If Korea wants to achieve 4 percent economic growth this year, exports to China would be critical. If Chinese growth slows down more than expected.. than it would be harder to achieve that four percent growth."

And... the expert added that Korea could face similar challenges to those which slowed down China's growth… namely higher prices of commodities and raw materials and shipping bottlenecks, and the country needs to deal with these problems to achieve its growth targets.
Seo Eunkyung, Arirang News.

#China #GDP #expectation

2021-07-15, 17:00 (KST)