Updated 2:00 PM EDT, Wed, May 20, 2020

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China Reports Weakest Economic Growth in 24 Years


(Photo : Reuters) A woman in Beijing shops at a discount department store decorated for the upcoming Chinese Lunar New Year. China’s economic growth in 2014 slowed down to the its weakest expansion in 24 years.

China's economic growth in 2014 slowed down to the its weakest expansion in 24 years, according to the country's National Bureau of Statistics (NBS).

The Chinese economy grew 7.4 percent in 2014, falling short of its government target of 7.5 percent.  Government officials are having difficulty transforming the economy into more sustainable growth amid a real estate slowdown, softening domestic demand and weak global recovery, reports China state news agency Xinhua.

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China's gross domestic product reached 63.65 trillion yuan (10.4 trillion U.S. dollars). Growth in the fourth quarter came in at 7.3 percent, which is unchanged from the previous quarter.

Despite the weak growth, the NBS tried to put a positive spin on the news. "The economy is maintaining steady operation under the new normal, with positive trends of stable growth, optimized structure, enhanced quality and improved social welfare," said Ma Jiantang, head of the NBS at a press conference.

Chin also reported weaker industrial output, which grew 8.3 percent in 2014, down from 9.7 percent growth the previous year. Growth in China's fixed-asset investment also slowed, to 15.7 percent. However, according to NBS data, retail sales rose 12 percent to 26.24 trillion yuan in 2014.

Frederic Neumann, co-head of Asian economic research at HSBC told BBC News that, although the economy is slowing down, the Chinese economy is has been more durable than expected.

"Although, at 7.3 percent last quarter, growth isn't as spectacular as over the past decade, it is still among the world's fastest," he said. "Especially reassuring is that retail sales and industrial production accelerated in December from the prior year."

Investment in the Chinese real estate market also slowed down in 2014 to a five-year low of 10.5 percent, well below the 19.8 percent growth it reported in 2013.

"More easing will likely be needed in the form of rate cuts and injection of liquidity," Neumann said. "Fortunately, China has the tools to fine-tune growth and I expect officials to make full use of these to make sure that growth doesn't dip below 7% over the course of this year."

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