Shenzhen, Aug 30 (SMM) – The slowdown in China’s economic growth is structural, not cyclical, and is likely to sustain in the future, said Liang Zhonghua, senior macro strategist at Zhongtai Securities.
Speaking at the SMM Tin Summit on Thursday August 30 in Shenzhen, Guangdong province, he added that China's productivity declined sharply after the global financial crisis in 2008. The rate of growth in productivity fell from 4% to 1% as innovation and technological advancements is a slow, gradual process.
External demand accounted for most of the growth of the Chinese economy before the financial crisis. Net exports of goods and services lifted growth in gross domestic product (GDP) by 1.6 percentage points in 2005-2007.
Changes in the population structure also lowered domestic demand after 2011. Chinese authorities then introduced fiscal stimulus to boost demand on the backdrop of weak demand at home and abroad, Liang added.