Bad debts and ever-rising corporate defaults plague China as it attempts to adapt to the economic realities of today’s world.
China has decided to lower its target for economic growth in 2019, attributing the slowdown to the impact of the trade war with the US.
Tuesday, Li Keqiang, China’s premier said that China was aiming for economic growth this year in a range of 6 to 6.5 percent, down from the hard target set at 6.5 percent for the previous two-years.
The choice to set a range gives Beijing policy flexibility as it steers the economy out of years of debt-fueled growth that has also buoyed the international economy. The option to set a range, yields Beijing flexibility as it tweaks its policy and navigate away from debt-charged growth, which has ironically helped maintain the international economy.
A long-time fear of China’s Policymakers was that a sustained downturn in growth would impact everyday Chinese citizens and lead the way to social unrest.
