China’s GDP might grow: UBS thinks China’s economy will go up by 4.4% in 2024. They believe the real estate market will steady, and there’ll be more investments in infrastructure. Tao Wang from UBS talks about three big ideas for China in 2024: making sure properties stay stable, sorting out debts, and changing the economy.
During a recent talk about what’s going to happen in 2024, Wang said that China is trying to make its economy steady and strong. But, there’s still a bit of trouble because the real estate market is not doing well. They expect the economy to grow by about 4.4 to 4.5%.
China’s GDP might grow
Wang explained, “We think China’s economy will grow by 4.4% in 2024, as the effects of recovering from Covid-19 start to fade and the real estate market stays slow.” They expect less building of things like roads, even though the government is giving more money, and more selling of products to other countries because of new technologies. They also think prices for things we buy will go up by 0.8% in 2024. More info about China’s GDP might grow by 4.4% in 2024, Says UBS, Shares 6 big ideas that could influence how China’s economy works.
UBS had also changed its prediction for India, saying it will grow by 6.2% in the next year, which is a bit slower than what they thought before.
Wang shared three big ideas for China in 2024: making sure the property market is steady, sorting out debts, and changing how the economy works.
Making Sure the Property Market is Steady
Because not many people are buying houses and buildings right now, Wang thinks that in the first half of 2024, with some help from the government, things will stop getting worse and maybe start getting better.
“We think that in 2024, not as many houses will be sold, and not as many new buildings will start being built. This will make the economy grow a bit slower than it did in 2023, but not as much,” Wang said. More info about China’s GDP might grow by 4.4% in 2024, Says UBS, Shares 6 big ideas that could influence how China’s economy works.
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Wang also said that if the property market is steady, people will keep earning money and finding jobs in 2024. This is because businesses like restaurants and shops will do better, and people will spend more money. But, they think people will be a little worried about the future, so they might not spend a lot.
Sorting Out Debts
The Chinese government makes a lot of money from things like selling land and buildings. But because the real estate market is not doing well, local governments have a hard time paying their debts. UBS thinks the central government will help out by changing how long they have to pay back the money and lowering the interest rates. They also think the government will give out more bonds to help clear debts.
Changing How the Economy Works
Wang said that in the future, making and selling houses won’t be as important for China’s economy. Instead, they’ll focus on things like making the environment cleaner, using more renewable energy, and helping people with services like electric cars. This is because the old ways of making money, like building things and heavy industries, won’t be as important anymore. In 2024, they also expect the government to spend more money on things like social housing and fixing up old neighborhoods. More info about China’s GDP might grow by 4.4% in 2024, Says UBS, Shares 6 big ideas that could influence how China’s economy works.
Government Help
Wang thinks that the government will keep trying to make the economy steady in 2024. They’ll give money to businesses and make it easier for people to buy houses by lowering the amount of money needed upfront and the interest rates on loans. The government will also spend more on building things like roads and bridges to create jobs.
More Money Exchange
As more people travel outside of China, UBS predicts that China will have less money coming in from other countries in 2024. But, they also think the Chinese currency will be worth more compared to the US dollar because of some changes in the world economy.
Prices Going Up a Bit
Wang thinks that prices for things we buy will go up a bit in 2024. This is because the cost of things like pork is going up, and people are starting to buy more again. But, because the real estate market is not doing well, the prices of things that companies use to make products will not go up too much.
Possible Surprises
UBS says there might be some surprises in 2024. For example, the property market might not get better, people might not spend as much as expected, or the government might have to do more to fix the money problems in different regions. Also, things happening outside of China, like the relationship between China and the US, could be different than expected. The value of Chinese money might also go up or down more than predicted.
