News Analysis Beijing struggles to maintain economic growth. The Chinese Communist Party (CCP) claims to have achieved 8.1 percent GDP growth last year, in spite of fourth quarter growth only hitting 4 percent. This year, Beijing faces reduced demand, supply chain disruption, and tight credit, as well as a lack of consumer and business confidence. In order to rein in the real estate sector, the CCP has curtailed available credit, driving down new housing starts and real estate sales. Decreased demand for houses has left developers short of cash, threatening bond repayments. Reduced liquidity, combined with diminished consumption, sporadic lockdowns, and increased borrowing costs have had a negative effect on the rest of the economy. Consequently, after two years of economic disruptions, Chinese citizens are either broke or lack the confidence to spend, as they face yet another year, plagued by uncertainty. Evergrande, the severely indebted property developer, has become …
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