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Research - MARCH 14, 2019

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Growth in China’s investment picks up in infrastructure and property spending

by Andrea Zander

China’s economy slowed with spending in infrastructure and real estate bolstering investment at the start of this year, but overall economic conditions in China are slowly stabilizing, according to figures from Chinese National Bureau of Statistics.

The slow improvement is due to the government’s deleveraging campaign to reduce debt and risky lending and the ongoing trade war with the United States. With the trade war, U.S. President Donald Trump said Wednesday he sees a “very good chance” of reaching a trade deal with China but is in “no rush” to reach an agreement.

Growth in infrastructure investment is below expectation. However, government-driven infrastructure investment did rise 4.3 percent year-on-year in the first two months, up from a 3.8 percent growth rate for 2018. Both expansions in spending on roads and railways accelerated to double-digit rates during the period.

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