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What slower GDP growth means for China’s real estate market

The property market accounts a meaningful proportion of China’s GDP growth

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China’s continued economic slowdown is reshaping the country’s real estate market, as investor confidence remains high.

Tax cuts, increased infrastructure spending and demand from foreign investors will support China’s real estate market in 2019 in the wake of slower economic growth.

China’s economy grew 6.4 percent during the last three months of 2018, the slowest pace since the global financial crisis.

The property market accounts a meaningful proportion of China’s GDP growth and Beijing has, in the past, deployed stimulus measures to support the market.

But the government’s on-going effort to deleverage the nation’s financial system has prompted a new approach.

“Real estate plays a very important role and has a direct and indirect impact on China’s GDP,”


Daniel Yao, head of research, JLL China.

To keep property prices under control, the central bank is pumping more liquidity into the economy to boost consumer confidence and the government is pushing banks to increase lending while making widespread corporate and income tax cuts.

“Previously the government would loosen real estate policy in response to a major slowdown, especially in the residential market, but they remain strict,” adds Yao.

Fresh infrastructure investment is also expected to boost the economy but the focus will be less on mega projects such as new metro lines, highways and airports, and instead on technology and telecoms infrastructure, supporting 5G networks and investment in artificial intelligence, for example.

This will create demand in the office and logistics real estate sectors. What slower GDP growth means for China’s real estate market | The Investor

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China

GM sells Thai factory to Chinese automaker GWM

After 20 years of operation in Thailand, General Motors will cease its activities, and resell its factory to the Chinese manufacturer Great Wall Motors

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General Motors (GM) announced it will stop selling Chevrolet vehicles in Thailand and sell its Rayong plant to Great Wall Motors (GWM) by the end of this year.

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Governments most exposed to coronavirus have strong fiscal and external buffers

Moody’s baseline assumption is that the economic effects of the outbreak will continue for a number of weeks, after which they will tail off and normal economic activity will resume.

Boris Sullivan

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As measures to contain the coronavirus and fear of contagion hit consumption and production, downside risks to our GDP growth forecast for China (A1 stable) have increased., says Moody’s Research Announcement.

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China

In China, an Unprecedented Economic Transformation

China has been undergoing an economic transformation unlike any other on the planet through an Industrial Revolution, urbanization, and an information age o experiencing all three simultaneously.

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HONG KONG, Dec 19, 2019 – (ACN Newswire) – Lei Zhang’ 02 is investing in Chinese companies during an extraordinary moment in history, he told students at Yale SOM.

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