According to a Bloomberg note on September 22, Goldman Sachs slashed its previous projection for China’s economic growth next year from 5.3% to 4.5%. The prediction of 3% expansion this year is unchanged. 

Goldman’s economists, led by Hui Shan, anticipate that the communist regime will continue to sustain its draconian “zero-COVID” policy until at least the March quarter of 2023 for two reasons.

First, China will need to keep COVID policies in place such as a higher vaccination rate for the older population, production of low-cost and working COVID medicines, among others.

On top of that, the communist regime will also want to wait until after the high season of Lunar New Year, along with the annual National People’s Congress to be held next March when all Chinese Communist Party officials are rearranged. 

The report noted that China’s economy is very vulnerable to the stringent zero-tolerance approach. The lockdowns in Shanghai and other cities in the June quarter almost contracted the economy. 

Moreover, the resurgence of COVID cases in July and a weak recovery in August also dragged on the country’s economic growth.

Due to the harsh nature of “zero-COVID” policy, Goldman thinks that any flare-up of infections due to loosened COVID restraints would result in immediate travel restrictions and supply chain disruptions, and thus impede economic operations.

The economists said that the communist regime slogan “housing is for living in, not for speculation” would likely persist if Chinese leader Xi Jinping succeeded in securing his third term on October 16.

Therefore, China would unlikely see any significant easing of restrictions in the property market.

Goldman said, “We continue to expect a sizable drag from the property sector to GDP growth this year and beyond.”

As reported by CNBC, the Asian Development Bank (ADB) on September 21 also lowered its previous growth forecasts for the CCP this year to 3.3% from 4% in July. 

The Manila lender also said that this will be the first time in more than 30 years that the rest of developing nations in Asia surpass China in terms of economic growth.

It said, “The last time was in 1990, when (China’s) growth slowed to 3.9% while GDP in the rest of the region expanded by 6.9%.”

This year, ADB predicts that these Asian countries will grow faster than China at the annual growth rate of 5.3%. 

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