IMF says staff assessing China’s growth steps, Georgieva to visit Beijing

The International Monetary Fund’s staff is still assessing steps announced by China this week to shore up its flagging economy but welcomes Beijing’s “focus on quality and sustainable growth,” IMF spokesperson Julie Kozack said on Thursday.

Kozack told a regular news briefing that IMF Managing Director Kristalina Georgieva and First Deputy Managing Director Gita Gopinath will travel to Beijing March 23 to 27 and will meet with Chinese authorities and attend economic conferences.

The trip follows Chinese Premier Li Qiang’s announcement of an ambitious 5% GDP growth target for China’s economy, along with steps to transform its growth model away from investment and deal with a property sector crisis and mounting local government debt. Li’s announcements contained few concrete details of the planned structural changes, and no timelines for implementation.

Consultations with Chinese officials also would provide the IMF’s top two executives a stronger perspective on China’s growth outlook ahead of the IMF and World Bank Spring Meetings April 15 to 20. The IMF estimates that China makes up 19% of global GDP based on a “purchasing power parity” measurement.

Asked for the IMF’s initial view of China’s economic policy steps, Kozack said staff was assessing them.

“We certainly very much welcome the authorities’ focus on quality and sustainable growth. And we will continue to review additional information provided by the authorities on the direction of policies and in the coming days,” Kozack said.

The IMF has long urged China to shift its growth model away from debt-fueled infrastructure and real estate investment, toward boosting weak domestic consumption, which it views as more sustainable. It has also called for China to deal with a troubled real estate sector that has crushed consumer spending and to rein in local government debt.

Georgieva will address the China Development Forum on March 24. Gopinath will deliver video remarks to the Boao Forum for Asia on March 27, Kozack added.
Source: Reuters (Reporting by David Lawder; Editing by Josie Kao)