China’s economic growth slowed markedly in the latest quarter due to major energy shortages, supply chain disruptions and the deepening crisis in the country’s property sector. GDP grew just 0.2 per cent from July to September compared to the previous quarter, according to figures released by the National Bureau of Statistics today.
In terms of annual growth, the figure of 4.9 per cent for Q3 2021 was the slowest in a year. In comparison, the economy grew by 7.9 per cent year-on-year in the three months from April to June.
An energy crunch – driven by coal supply problems and heightened energy demand for construction projects earlier this year – has affected factory output causing production to fall to its lowest since the first quarter of 2020. The country has responded by stepping up coal production despite its pledge to cut emissions.
Major property developer, China Evergrande Group, was also recently revealed to have run up more than $300bn of debt leading to fears that the country’s property bubble is about to burst. The construction sector, which accounts for 29 per cent of GDP, had borrowed heavily and built extensively in recent decades. But around a fifth of the country’s housing units currently lie vacant and many are unaffordable.