The Conference Board predicts that the Chinese economic recovery is unlikely to reach pre-pandemic levels next year, and GDP growth will slow to 4.1% compared with a projected 5.2% in 2023. This forecast is based on four factors: Reduction of unsatisfied demand. China's consumption growth in the third quarter was driven by pent-up demand, which is likely to decline in the coming months. Consumer confidence remains low, and at the moment there are no signs indicating a change in this situation. Chinese citizens are still worried about their financial security, the labor market, and government policies that encourage savings but limit spending. The downturn in the real estate market will continue. China's largest developers have defaulted or gone bankrupt, and the authorities' attempts to stabilize the real estate sector have proved ineffective. Analysts believe that households in China have lost confidence in real estate as a means of accumulating wealth. The slowdown in foreign demand for Chinese products. The global economic downturn in the United States and Europe is also negatively affecting China, as demand for Chinese exports will continue to decline in the new year. China's economy will not be able to compensate for losses due to exports due to lower demand in its domestic real estate market. Gradual implementation of incentive measures. Due to China's deep structural problems, the introduction of large stimulus packages is unlikely. The policy of stimulating credit and investment growth is limited, and going beyond this policy may exacerbate economic problems. Therefore, the Chinese government is taking cautious and gradual steps towards stimulating the economy.
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