Tallahassee Journal

China Economic Growth Is Slowest in Decades

China Economic Growth Is Slowest in Decades

China’s economic growth slowed to 7.4% in 2014, downshifting to a level not seen in a quarter century and firmly marking the end of a high-growth heyday that buoyed global demand for everything from iron ore to designer handbags. The slipping momentum in China, which reported economic growth of 7.7% in 2013, has reverberated around the world, sending prices for commodities tumbling and weakening an already soft global economy.china-manu

China’s economy grew 7.3% in the fourth quarter from a year earlier, the National Bureau of Statistics said, buttressed by targeted moves to ease borrowing. But it continued to face a housing glut, soaring debt and overcapacity in many industries, factors likely to erode growth in 2015. Beijing had said it expected “about” 7.5% growth in 2014. The chief of the statistics bureau said Tuesday the rate was within that range.

Chinese stocks rose on the news, a day after their largest one-day drop in more than six years following a crackdown on margin trading. While 7% growth would be the envy of most economies, Beijing says at least this level is needed to create enough jobs for China’s huge population. The Communist Party sees social stability as an essential component in maintaining its grip on power.

The results follow decades of growth that has hovered around 10%, one of the broadest, most rapid economic ascents in history that helped raise Chinese living standards and propel global growth and trade to new heights. Slipping economic momentum in China has had far-flung implications, squeezing Australian government budgets and Chilean copper mines that grew increasingly dependent on China’s ascent. The slowdown comes at a vulnerable time for the world economy. The eurozone is at risk of a third recession in six years. Abenomics policies have failed to lift Japan out of stagnation.

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