IMF maintains China’s 2018 GDP growth forecast at 6.6%

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The International Monetary Fund (IMF) expects Chinese economy to grow by 6.6 percent in 2018, unchanged to the January forecast, according to a statement released Wednesday by James Daniel, assistant director of the Asia and Pacific Department of the IMF.

Daniel wrapped up his 14-day visit to China with an IMF team Wednesday, and has held discussions on the annual review of Chinese economy.

China's financial sector de-risking accelerated with a wide range of decisive measures adopted, credit growth slowed, overcapacity reduction progressed; anti-pollution efforts intensified, and opening up continued, said the IMF statement.

IMF also recognizes Chinese government’s policy shift from high-speed to high-quality growth, saying the changes will increase economic benefits for all Chinese people and make growth more sustainable.

“Given China's record of successful reforms in the past decades, and the authorities' strong commitment and determination, we are confident that China will rebalance to a sustainable growth model,” Daniel said.

IMF notes that China’s growth targets could be achieved by speeding up reforms in such areas as boosting consumption and limiting credit growth.

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China in March set a full-year growth target of around 6.5 percent.

Chinese economy grew by 6.8 percent in the first quarter of this year, slightly faster than expected, buoyed partly by strong consumer demand.

The government is in the third year of a regulatory crackdown on riskier lending practices, which has slowly pushed up borrowing costs and is pinching off alternative, murkier funding sources for companies such as shadow banking.

Trade frictions also pose a risk for China's economy, said senior resident representative at the IMF Alfred Schipke, when asked about the impact of the ongoing tensions with the US.

The bilateral trade ties have taken a sudden turn to the south after the US said Tuesday it plans to impose 25 percent tariffs on Chinese imports worth of 50 billion US dollars after mid-June. China is urging the US to uphold their joint statement made in Washington earlier this month.

(With inputs from Xinhua, Reuters)