China has reported its first rise in annual growth since 2010 – seemingly benefiting from growing demand abroad as the world economic recovery gathers pace.
The country’s National Bureau of Statistics (NBS) has published figures for the fourth quarter of 2017 and the year as a whole, showing a better-than-expected reading of 6.9% for the year – above the country’s target rate of 6.5%.
That rate was set as Beijing said it wanted to achieve a more sustainable level of gross domestic product (GDP) growth amid worries about a growing debt mountain, risky investments and high pollution levels – particularly from industry.
Despite the crackdown on smog, including halving output at some steel plants, a surge in industrial production helped drive growth in exports in the fourth quarter, the NBS said.
It credited improved demand in the world economy.
Domestically, an increase of more than 10% in retail sales over the 12 months was highlighted as the world’s second largest economy attempts to reposition its output more towards consumption and away from a reliance on its factories.
GDP growth of 6.7% in 2016 was the slowest for more than a quarter of a century – leaving Beijing under pressure to aid a jump.
Separate figures have shown overall growth in credit in 2017, despite efforts to curb risky lending across the board.
The International Monetary Fund has repeatedly warned of risks stemming from China’s ballooning debt, saying last year that each extra dollar of debt is producing diminishing returns for China’s economy.
The world’s lender of last resort has accused Beijing of placing a greater focus on growth than debt controls – with the authorities’ support for the economy through credit stimulus a factor.
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The Chinese government says it has brought down the pace of debt accumulation.
Louis Kuijs, of Oxford Economics, said: “While domestic demand should cool on tighter financial policy, China’s policymakers want the slowdown in credit and the economy to be gradual. We project GDP growth to slow to 6.4 percent this year.”