China’s latest official economic growth numbers are in. For the full year, the Chinese economy grew a surprising 6.9%, up from a 26-year low in 2016, and beating the government’s target of 6.5%, according to an article from World Economic Forum.
China’s economic growth, among the world’s fastest in recent decades, is fueled in large part by surging debt. The country’s total outstanding debt was worth an alarming 274% of its GDP in the first half of last year, more than double the ratio from 2008, according to an estimate from Deutsche Bank.
Chinese officials have signaled less emphasis on growth, pledging in December to shift focus to cracking down on financial risk, pollution and poverty in the coming years. The country’s strong growth for 2017 has given policymakers a perfect window to accelerate debt reduction, which is “likely to come at the cost of slower GDP growth in the near term but will improve China’s long-term economic prospects,” notes the World Bank in a December report.
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