China revises 2014 Economic Growth Estimate

China revises 2014 Economic Growth Estimate

China has changed its 2014 growth rate to 7.3% from 7.4% because of a weaker-than-reported contribution from the service sector that casted doubt on an economic bright spot in the middle of concerns regarding the health of the world’s second-largest economy.

The change is relatively small, but it has suggested that China’s effort to meet its official growth target of around 7.5% previous year was tougher than it appeared. It came up as worries have grown that China will struggle to reach around 7% goal of this year.

IHS Global Insight economist Brian Jackson said, “That’s the beauty of using ‘about’ in your targets. It’s undefined. No one knows if you reach it. Even they may not know. It gives them flexibility to revise it later”.

On Monday, China’s statistics bureau said that previous year, the nation’s gross domestic product totaled 63.614 trillion yuan, or around $10 trillion. It was 32.4 billion yuan down as compared to its initial estimate in January of present year. The change has amounted to less than 0.1% of China’s total economy. According to the statistics bureau, the number could be revised once again at the time of release of final results in January 2016.

The service industry was the main reason for the change, which as per the agency, has grown by 7.8% rather than 8.1%. China wants to shift its economy from debt-fueled investment to consumption and services and is trying hard for it.

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