China’s Finance Minister Lou Jiwei played down yuan declines and the risks from shadow banking as central bank Governor Zhou Xiaochuan signaled that the nation’s economy can sustain growth of between 7 percent and 8 percent.
China’s expansion prospects are suitable for the nation and can boost global economic growth, Zhou said. The country’s services industry has overtaken manufacturing while its contribution to global growth is about 30 percent, Lou said in a statement posted on the People’s Bank of China website. Possible defaults in some wealth-management products don’t reflect a “big problem” and recent yuan weakness is within the normal range, the finance minister told Bloomberg News.
China is stressing the resilience of its economy even as efforts to rein in leverage and expand the role of markets has prompted analysts to forecast the slowest pace of expansion since 1990. Group-of-20 policy makers meeting in Sydney pledged a coordinated push to boost growth by more than $2 trillion over the next five years. The G-20 communique singled out China among emerging nations exhibiting “continued solid growth,” changing the language from a draft seen by Bloomberg News that hadn’t named the world’s second-largest economy.
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