The World Bank said it now expects China’s growth to expand by 7.5% next year, down from a projection of 9.2% just three months ago. The bank said re-balancing the economy away from exports and toward consumption would be key. China’s mobile operators would be pleased if some of that consumption came in the form of new 3G phones. With Beijing hinting that it may issue 3G licenses as early as next month, China Mobile, Unicom and the like have launched marketing blitzes and taken to the streets to sign up customers.
Joerg Wuttke, president of the European Union Chamber of Commerce in China, believes real estate is crucial to shoring up the Chinese economy. “Kick-starting of the real estate sector has probably the biggest impact on the real economy when it comes to the bigger items that European companies are interested in,” he said. Meanwhile, two companies active in the real estate market, developer Hopson Development Holdings and Guangzhou Investment Co, both saw their Hong Kong-listed shares drop more than 10% ahead of alterations to the MSCI China Index that began today. They are among the nine stocks that MSCI, an equity index compiler, said would be removed from its mainland benchmark index.
The property market also continues to be a source of woe for China’s steelmakers, who are now lamenting that “the era of high profits … has already come to an end,” at least according to Yang Siming, chairman of Nanjing Iron & Steel Group. Steel output plunged 17% in October, as companies scaled back operations to cope with falling prices.