The International Monetary Fund (IMF) has raised the GDP growth projections for China for 2023 and 2024 on Tuesday. China's GDP growth was raised to 5.4 per cent in 2023 and 4.6 per cent in 2024.
The country's growth outlook was reduced in October by the Washington-based financial group to 4.2 per cent in 2024 and 5 per cent in 2023.
According to Reuters, the IMF stated in an official statement that due to persistent weakness in China's real estate market and muted foreign demand, GDP growth would drop to 4.6 per cent in 2024.
The increased revision came after China decided to assist the economy by approving a 1 trillion yuan ($137 billion) national bond offering and allowing local governments to frontload a portion of their 2024 bond quotas.
Due to a stronger-than-expected third-quarter returns and recent policy initiatives, the IMF's First Deputy Managing Director Gita Gopinath said that these predictions imply upward revisions of 0.4 percentage points in both 2023 and 2024 relative to October WEO projections.
According to her, China has taken a number of steps to support the real estate industry, but more is required to ensure a quicker recovery and reduced economic expenses during the transition.
According to Gopinath, a comprehensive policy package should include steps to hasten the exit of unprofitable real estate developers, remove barriers to the adjustment of housing prices, provide more central government funding for the completion of housing projects, and help financially sound developers adjust to a more competitive real estate market.
The IMF published its economic forecasts on October 30. According to these forecasts, global growth will stay at 3 per cent in 2023 and then drop to 2.9 per cent in 2024. This was one of the slowest growth rates observed in many years