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1 Oct, 2011

Full-blown economic crisis unlikely in China – chinadaily.com.cn

BEIJING – A global recession could be the biggest risk facing China, but a full-blown economic crisis is unlikely, given the nation’s relatively healthy balance sheets, said Huang Yiping, chief economist of emerging Asia at Barclays Capital, the investment banking arm of Barclays PLC, on Thursday.

“A global economic recession could cause a hard landing for the Chinese economy because of its high dependency on trade and limited policy flexibility,” Huang said.

According to a recent survey by the British investment bank, a hard landing in China is viewed by investors as the third-biggest downside risk to emerging markets assets in the coming three months.

Although China has a number of homegrown problems, such as extraordinary credit expansion, an overheated property market and difficulties in local government financing, Huang said growth is likely to remain robust despite the external uncertainty.

via Full-blown economic crisis unlikely in China | Economy | chinadaily.com.cn.