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    IMF's Latest View on China

    Professor of Financial Economics and Part-time Value Investor, Transfin.
    Aug 21, 2017 4:30 AM 2 min read

    IMF released its outlook on the Chinese economy this month post an annual bilateral exchange. Kicking-off our series on the six key conclusions with:

    #1 IMF takes a positive view of Chinese GDP on the back of the govt's expansionary macroeconomic policy and increased stimulus

     

    #2 Chinese debt remains a concern potentially posing as a headwind against medium term growth

     

    #3 Chinese govt on a path towards deleveraging to narrow the large "credit gap"

     

    #4 China's high savings culture which protects it against systemic shocks, also mutes consumption and growth

     

    #5 Significant scope to increase govt spending on education, pensions, and health, to boost consumption and bring China in-line with Developed nations

     

    #6 Capital allocation should move away from low ROCE firms to increase growth potential