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Chinese economic soft landing to affect Asia: report

Chinese economic soft landing to affect Asia: report

Taipei, Feb. 15 (CNA) A Nikkei report published Friday on its Chinese-language website said that a "soft landing" outcome for China's sweeping transformation to a consumer-driven economy will cause considerable ramifications across Asia. The other possible outcome is a "hard landing" that would see China's annual economic growth rate fall below 7 percent. Ahead of the Lunar New Year holiday, a Feb. 4 decision by the Chinese central bank, the People's Bank of China, to cut the amount of cash that banks must hold in reserve is an indication of the state's efforts to prop up economic growth momentum, according to the report. The greatest risk faced by Asian economies is uncertainty in how China's economy will fare in the future, said a Standard & Poors executive in Tokyo earlier this month. In light of China's 7.4 percent GDP growth over 2014, a 0.7 percent decline anticipated in two year's time will have considerable ramifications across Asia, said the report. The report said that as China's momentum slows, GDP growth in Hong Kong is expected to slide by 2.3 percent, in Taiwan by 2.1 percent, in South Korea by 1.3 percent, in Singapore by 1.0 and in Australia by 0.8 percent. As a result, economies across Asia, including Australia and Singapore, have been relaxing their respective monetary policies to mitigate the anticipated impact of China's waning growth momentum, said the report. Chinese Premier Li Keqiang in January this year reassured world leaders gathered at the Swiss resort of Davos that China will steer clear of an economic hard landing. Meanwhile, Japan has been seeking to diversify its interests by adopting the "China plus one" strategy to avoid over-reliance on a single investment destination. (By Charles Kang and Ted Chen)


Updated : 2021-09-23 18:03 GMT+08:00