Chinese economists have cut their forecasts for the country’s gross domestic product in 2024 in the latest quarterly Nikkei and Nikkei Quick News survey, underlining the pressure on authorities struggling to revive growth.

The average forecast of 28 local experts on China’s economy points to annual GDP growth slowing to 4.8 per cent, down from 4.9 per cent in the previous survey in July. Some of the economists submitted or updated their responses after Chinese authorities last week cut interest rates, supported the property market and pumped billions of dollars into the stock market, sending shares soaring. For those who responded before the stimulus began, the Nikkei asked whether they wanted to change their forecasts.

Of the 25 economists who made full-year growth forecasts in the previous quarterly survey, 16 cut their outlooks, while nine held their expectations steady. The overall range of growth forecasts shifted downwards from 4.8 to 5.3 percent to 4.5 to 5.0 percent. The average forecast for the July-September quarter is 4.6 percent, a further deceleration from the 4.7 percent growth recorded in the April-June period and weaker than the 4.9 percent expansion in the third quarter of last year. The quarter-on-quarter growth forecast for the third quarter, which better reflects the momentum of the economy, is 1.1% in seasonally adjusted terms, slightly higher than the 0.7% growth recorded in the second quarter.

Analysts warned of significant headwinds. KGI Asia’s Ken Chen cut his annual growth forecast to 4.9% from 5.3%, taking into account recent weaker-than-expected data ranging from industrial production and investment to retail and property sales. The current economic growth trend is still down, mainly due to the bottoming out of the property cycle and downward pressure from external demand,’ he said, suggesting that stimulus may not be enough to achieve the government’s annual GDP target of ‘around 5%’.

Despite policy efforts to lower mortgage rates and reduce the cost of buying, the housing sector remains a major drag. When economists were asked to pick the top three risks from a list of nine, the “sluggish housing market” topped the list, cited by 17 out of 20. This was followed by ‘weak consumer confidence’ and ‘no or inadequate policy’.

Hui Shan, chief China economist at Goldman Sachs, cut his forecast from 4.9% to 4.7%, saying that previous policy measures to stimulate the property market “may not be as effective”.

Tetsuji Sano, chief Asia economist at Sumitomo Mitsui DS Asset Management, said: ‘Consumer demand is likely to fall across the board as the population continues to age and the pension system is underdeveloped.

Property accounts for about 70% of Chinese household assets. This means that the fall in house prices has a direct negative wealth effect, reducing consumer confidence and fuelling deflation concerns.

There are clear risks that deflationary pressures could become entrenched,’ said Alex Muscatelli, Chief Economics Officer at Fitch Ratings. He noted that the GDP deflator, which reflects general price changes in the economy, has fallen on an annualised basis for five consecutive quarters, while prices of basic goods and services have remained flat.

China is heavily reliant on manufacturing and exports, especially as it has struggled to improve sentiment since the COVID-19 outbreak, but momentum in this sector is also starting to wane. Industrial production growth slowed to 4.5% y/y in August from 5.1% y/y in July.

This comes at a time of heightened trade protectionism, with the US, the European Union and Canada imposing additional tariffs on Chinese electric vehicles. Similarly, Indonesia has reimposed tariffs on goods such as textile imports, particularly from China, which came into effect in August.

Arjen van Dijkhuizen, senior economist at ABN AMRO Bank, noted that trade divergence has helped mitigate the impact of tariffs to some extent and that exports remain the key driver of China’s growth. ‘However, China’s supply-side strategy is contributing to escalating trade frictions, with the US, EU and others protecting strategic sectors from China’s [oversupply],’ he said.

Ongoing external and internal uncertainties appear to be behind the stimulus measures, which involve numerous central government agencies, including the People’s Bank of China.

It is rare for the PBOC to announce both a [reserve requirement ratio] cut and an interest rate cut at the same time, signalling the urgency policymakers feel to provide support,’ said Jing Liu, chief economist for Greater China at HSBC.

Jian Chang, chief China economist at Barclays, agreed. Recent developments signal that the Chinese leadership is taking a more proactive approach to tackling its most pressing structural problems. However, both bank economists left their annual forecasts unchanged at 4.9 per cent and 4.8 per cent respectively.

Looking beyond this year, the economists expect a gradual slowdown to 4.5 per cent in 2025 and 4.2 per cent in 2026, reflecting a long-term structural slowdown.

“The crisis in the housing sector, the associated loss of housing wealth and the need for households to repair their balance sheets, as well as uncertain income and job prospects in an uncertain economic environment, are hampering domestic consumption,” said Sophie Altermatt, economist at Julius Baer.

Wei Yao, chief Asia and China economist at Societe Generale, said ‘the current state of the economy calls for more radical measures’ and stressed the need for ‘restructuring of real estate and local government debt rather than further interest rate cuts to end the deflationary spiral’.

Afghan journalists, who had the experience of being imprisoned, say that they were imprisoned in the same cells as Islamic State (IS) also known as Daesh members. A local journalist in the north of the country who was recently arrested and tortured by the Taliban said: “No professional has been humiliated to this extent,” referring to the journalism professionalism.

Afghan journalists have reported hundreds of cases of torture, arbitrary arrests and increased censorship in the past three years.

They say they are often arrested for covering attacks by opposition groups or writing about discrimination against women. Some of them have announced that they were imprisoned in the same cell with members of the Daesh group.

“My colleagues and I no longer want to continue this profession. New restrictions are announced every day. If we cover attacks or issues related to women, we face phone threats, subpoenas or arrests,” a journalist who was recently arrested and beaten told a foreign media.

At the time of Taliban takeover in 2021, Afghanistan had 8,400 media workers, 1,700 of whom were women. But according to media sources, now only 5100 journalists are working, of which 560 are women.

Taliban asks journalists to respect Islamic values, the country’s national interests while reporting.

One of the officials of organizations supporting journalists, who wished to be recognized by his pine name, Samullah, said “since the Taliban returned to power, we have recorded about 450 cases of violations of journalists’ rights, including arrests, threats, physical violence and torture.”

However, Hayatullah Mohajer Farahi, the Deputy Minister of Information and Culture, said that the media is allowed to operate in Afghanistan, but asked that they should respect “Islamic values, the country’s national interests, and its culture and traditions.”

Last month, new rules were applied to the media’s political talk shows. According to the editor-in-chief of media outlets, based on the new decision of the Taliban, the guests must be selected from the approved list of this group, the topics must be approved in close coordination, and criticism of the regime is prohibited. These programs should not be played live until the recordings are checked and “weaknesses” are removed. An employee of Afghanistan’s state radio and television said that women are no longer allowed to work as reporters.

In Helmand province, it is forbidden to broadcast women’s voices on TV and radio. Also, monitoring of journalists in social networks continues and media continue to operate through self-censorship.

The implementation of new law introduced by the Taliban ministry for the propagation of virtue and the prevention of vice, has also added to the worries of journalists. This law prohibits taking pictures of living creatures and also prohibits women from speaking in public.

Taliban arrests key Daesh members responsible for recent attack that kills many

Taliban said that they have captured key members of the Daesh terrorist group, including a citizen from Tajikistan — they were responsible for recent deadly attacks across Afghanistan.

Taliban spokesman Zabihullah Mujahid said that the Taliban’s special forces arrested key members of Daesh claimed that a Kabul suicide bombing that left six people dead last month.

Though, he didn’t specify the arrested number of Daesh members, but said that the Daesh suicide bomber “infiltrated Afghanistan from a training camp in Pakistan.” He also claimed that other members of Daesh were arrested in a series of raids but said all of them recently returned from there (camp in Pakistan.)

Mujahid said that the Daesh group “have established new operational bases and training camps” in Pakistan, saying “from these new bases, they continue to orchestrate attacks, both within Afghanistan and in other countries.”

China’s high-level anti-corruption drive continues.

The Central Commission for Discipline Inspection (CCDI), China’s top political discipline and anti-corruption body, has reportedly placed a senior inspector under investigation.

According to the South China Morning Post, discipline chief Li Gang is under surveillance as part of the investigation. Li was appointed by the CCDI to the Central Organisation Department, the Communist Party’s top human resources office.

The CCDI announced on Monday that Li was under ‘disciplinary review and surveillance investigation’ for ‘suspected serious violations of discipline and law’.

In the past two weeks, three other senior officials have been placed under investigation on similar charges.

They are Cao Xingxin, deputy general manager of state-owned telecoms giant China Unicom, Sun Yuning, deputy director of the General Administration of Customs, and Du Yubo, former vice-minister of education.

According to a count by the South China Morning Post, 44 senior cadres were placed under investigation in the first nine months of this year, up from 34 in the same period last year.

The CCDI said 45 senior officials were investigated last year. This is the highest number since Xi launched his sweeping anti-corruption campaign in 2013, in which he vowed to go after both ‘tigers’ and ‘flies’ – powerful leaders and lower-level bureaucrats.

Two more were added to the 2023 total in June, when the Politburo announced that former defence ministers Li Shangfu and Wei Fenghe had also been placed under investigation last year.

All the detained Tigers belonged to a pool of what the CCDI calls ‘centrally directed cadres’, officials with the rank of vice-minister or above.

A smaller number held slightly lower ranks but occupied key positions in critical sectors.

Li, 59, a vice-minister, is the highest-ranking disciplinary chief to be dismissed this year after Long Fei, the disciplinary chief of the state-owned China Southern Power Grid.

Long was placed under investigation in February and expelled from the Party in August for serious violations of Party discipline and laws.

Addressing the CCDI’s general assembly in January, Xi urged the top discipline watchdog to ‘regularly weed out rotten apples’ as the fight against corruption remained ‘serious and complex’ after more than a decade.

Xi said the CCDI should ‘resolutely prevent and crack down on wrongdoing’ to strengthen the building of its discipline inspection and supervision team and become a ‘model of self-reform’.