IMF chief calls on China to “reinvent itself” to end mounting property crisis

“China faces a fork in the road — rely on the policies that have worked in the past, or reinvent itself for a new era of high-quality growth,” IMF head Kristalina Georgieva said at the China Development Forum on Sunday, the Financial Times reports. Georgieva urged China to implement policies to “reinvent itself,” including measures that would boost domestic consumption and production rates and end the country’s mounting property crisis.

By the numbers: A more domestic consumption-centered policy mix could add USD 3.5 tn to China’s economy over the next 15 years, but this depends on “boosting the spending power of individuals and families,” reducing risks from local government debt, and completing abandoned housing projects, Georgieva said.

The Chinese economic miracle no more? Foreign direct investment to the world’s factory in 2023 hit its lowest level in three decades on the back of slow post-pandemic recovery and the property crisis continuing to worsen with the country’s largest property developer defaulting on a USD bond in October. The slowdown in China also led credit rating agency Moody’s to downgrade its outlook on the country’s sovereign credit rating to negative from stable in December.

ALSO WORTH NOTING-

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• Bahraini wealth fund takes overUK’s McLaren: Bahraini sovereign wealth fund Mumtalakat has become the sole owner of the UK’s supercar maker McLaren Group after increasing its share to 100% from 60%. (BBC)

THE MARKET THIS MORNING-

Asian markets are in the red and US and European futures largely unchanged as traders look ahead to a holiday-shortened trading week. Dow, S&P, and Nasdaq futures were all down by fractions of a percentage point. The Kospi, Hang Seng, Nikkei, and Shanghai Composite were all (just) in the red at dispatch time this morning.

THE CLOSING BELL-

The DFM rose 0.1% yesterday on turnover of AED 418 mn. The index is down 5.4% YTD.

In the green: Al Firdous Holdings (+14.7%), Ithmaar Holding (+8.9%) and Ekttitab Holding Company (+4.9%).

In the red: Air Arabia (-5.7%), Al Salam Bank (-3.3%) and Mashreq (-2.8%).

Over on the ADX, the index rose 0.4% on turnover of AED 792.5 mn, while Nasdaq Dubai closed up 0.4%.

CORPORATE ACTIONS-

Dubai Ins. approved distributing AED 70 mn in dividends to shareholders, equivalent to 70 fils per share, Argaam reports.