China’s government published official forecasts for the country’s economic growth in 2016. According to the data, the Chinese economy will expand by not less than 6.5-7% on an annual basis. In the next five years, from 2016 to 2020, the GDP growth rate is not expected to be below 6.5%.
Experts anticipate that China’s consumer price index, the key indicator of inflation, will advance by 3%, more than twice exceeding the final result of the previous year.
Budget deficit, another very important indicator for the Chinese economy, was budgeted at 3% in 2016 that approximately equals 2.18 trillion yuan, or 334 billion US dollars. The projected deficit was up from 2.3% in 2015. Besides, the country’s government is planning to increase the military budget by 7.6% to 954 billion yuan, or 146 billion US dollars. Despite such large numbers, it is the smallest climb in China’s military spending in the last six years.
In the previous year, China’s economy expanded by 6.9%, its slowest pace in 25 years. Profits made by industrial enterprises declined by 6.4 trillion yuan, or 973 billion US dollars amid subdued demand for industrial products. Moreover, capital outflow hit the highest reading of 1 trillion US dollars.
Taking into account the figures, Moody’s, an international rating agency, downwardly revised China’s credit rating to negative from stable.
