- While China’s economic recovery story has been largely disappointing, the economic powerhouse has achieved impressive growth in certain sectors, Standard Chartered said.
- Winters said that while China’s recovery remains “somewhat bumpy,” what it is building is a more resilient, sustainable and stronger economy.
A Chinese flag flies outside a residential building in Beijing on April 30, 2017.
Greg Baker AFP | Getty Images
Standard Chartered’s Bill Winters said while China’s economic recovery story has been largely disappointing, the economic powerhouse has shown impressive growth in certain sectors.
“Electric vehicles and everything around sustainability and renewable power technology. In those areas, , China is definitely growing rapidly.”
Although China’s recovery remains “somewhat bumpy,” the country is building a more resilient, sustainable and stronger economy, he said.
And that playbook? “We will gradually ease the compression of the old economy sector and accelerate the compression of the new economy sector,” Winters added.
China boasts the world’s largest EV market According to Canalys research, 5.9 million EVs will be sold in 2022, accounting for 59% of all EVs sold worldwide. Additionally, Counterpoint Research data shows that: Domestic brands account for 81% of the EV market — BYD, Wuling, Chery, Changan, and GAC are among the top players.
Conversely, real estate giants Evergrande and Country Garden continue to be mired in debt problems, and the real estate market is suffering due to weak consumer confidence.
Standard Chartered is reducing its exposure to China’s troubled property sector, which has been hit hard, Winters said. Although he said it would be unwise to expect China’s real estate market to bottom out yet, he said the market is “entering the second half of the downturn in the real estate market.”
An apartment complex built by Evergrande in Huai’an City, Jiangsu Province, China on July 20, 2023.
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Just last week, the UK-based bank announced a 33% drop in pre-tax profits for the third quarter of this year.
China’s recovery after the coronavirus pandemic has slowed since April. Further hindering the recovery is the real estate recession, which accelerated over the summer even though many major cities eased restrictions on condominium purchases.
However, China remains an important market for the bank. Others include India, United Arab Emirates, South Korea, Singapore and Hong Kong.
“Hong Kong is a core market for us. We’ve been here for about 170 years. Hong Kong is our largest single market,” Winters continued.
Winters said Standard Chartered’s offshore business, which is based in Hong Kong, is growing at 50% to 60% a year. “So this is a big growth story for us.”