Cracks appear in China | Bangkok Post: business

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Cracks appear in China

Triple threat of high leverage, slow economic growth and soaring property prices could spell trouble for world’s second biggest economy, some analysts warn.

  • Published: | Viewed: 1,134 | Comments: 1
  • Newspaper section: Asia focus
  • Writer: Nithi Kaveevivitchai
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Over the past three decades, China has undergone the greatest economic boom in world history, but now it faces a major challenge to sustain its rise. As the European crisis drags on and the US recovery remains slow, a new leadership team in China is struggling to arrest slowing growth. 

Opinions vary about whether the world’s second largest economy can achieve a soft landing, or whether it faces a hard landing or even a financial crisis. In any case, some economists have warned that the remaining years of annual economic growth in the high single digits can now be counted on the fingers of one hand.

According to two economists from Nomura, the same three warning signs that preceded severe downturns in Japan, the United States and parts of Europe are now flashing over China. As a result, the government has limited time to contain the growing risks and keep the country out of trouble.

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