Government efforts pay off

china

Encouragingly, efforts to slow investment in these specific areas has not had a significant impact on export, domestic consumption or foreign direct investment, all of which continue to drive economic growth in China

Richard Wong, manager of HSBC's GIF Chinese Equity fund, believes a soft landing for the Chinese economy should be achieved. The government's efforts to slow the economy have been successful so far, with fixed asset investment and loan growth slowing considerably since the introduction of the austerity measures in April 2004. Wong notes that the government's aim has been to discourage further investment into low end product segments in industries such as steel, alumina and cement - where excess capacity has been building - while continuing to encourage investment in the production of high...