China’s GDP slows from 6.3 to 4.9% in third quarter

The economic growth of China slowed to 4.9% annualized in the third quarter, according to official data, as the real estate crisis It affected consumption and business activity in the country.

The figure exceeded Bloomberg analysts’ forecasts of 4.5% growth in July-September, but was far from the 6.3% recorded in the previous three months.

The country faced a “serious and complex international environment and challenging tasks to promote reform, development and stability at home” during the first three quarters of 2023, the National Statistics Office said.

He real estatewhich has long represented a quarter of the country’s Gross Domestic Product, supports thousands of companies and is an important source of employment.

The sector enjoyed phenomenal growth for decades but recent problems from key developers such as Evergrande and Country Garden, fuel buyer distrust, while homes remain unfinished and prices plummet.

Country Garden, one of the largest Real estate companies China, long believed to be financially sound, last month failed to repay interest on a $15.4 million loan.

The group has been granted a 30-day grace period, which ends today, and is at risk of default if it fails to make the refund.

In recent months, authorities have increased incentives for property purchases to revitalize the sector, however, buyers remain cautious.

Households are watching their spending in a context of slow growth, which in turn has affected consumption.

However, a week of national holidays in October has helped boost spending on tourism and other services.

“The Chinese economy has shown signs of stabilization,” said Ting Lu, an analyst at Nomura.