Cutting and slashing

It appears Beijing’s chances of hitting its magic 8% growth target this year are getting slimmer. The International Monetary Fund (IMF) cut its growth forecast for China’s economy to 6.7% from 8.5% yesterday. IMF officials called on the government to provide a better stimulus package that will help to accelerate domestic consumption. The Big Four banks are pulling their weight in the stimulus efforts, reportedly lending out about 20% of their annual loan quota in January alone. Most of that money went to infrastructure projects including railways, highways and electricity grids. China Eastern Airlines could use a bank loan right now. The carrier is selling its stakes in subsidiary units and cutting orders for new planes, but executives say the company is unlikely to turn a profit this year. More predictions of doom came from the president of China Merchants Bank (CMB) who said he doesn’t expect stellar profits from his industry this year due to lower interest rates and an increased rate of defaults on loans.