Jan 5, 2019
How worried should we be about China's economy?
Adding to the worries, China's stock market was the world's worst performer last year, ending with a loss of 28%. This week Apple said slowing sales in China meant it would not meet sales expectations, triggering sharp falls on global stock markets. In September, Nike said sales in Greater China shot up 24%. Lululemon, another activewear maker, also reported strong sales growth in China last year. Louis Kuijs, head of Asia economics at Oxford Economics, sees GDP growth "Bottoming out" around the second quarter of this year, and expects an annual growth rate of 6.1%. But he does not see it deteriorating much further: "While China's economy is slowing down, it is not tanking and Apple's profit warning is not a good proxy for the health of the overall economy or even overall consumer spending." George Magnus, research associate at Oxford University's China Centre, points to serious and growing worries over the lack of regulation that sets doing business in China apart from that of the rest of the world. "A steadily slowing China imparts a major drag to the world economy in any case. Add to this fears of the decline being disorderly, all other risks pale in comparison."
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