Moody's says China growth in medium term to remain robust

Moody's Investors Service said that China's authorities have begun to prepare for a rebalancing of the economic roles of the public and private sectors, which if successful would imply a fundamental realignment in the country's political economy over the next decade.

In a special report, Moody's said that a new phase of structural policy reforms is coming into focus following the Chinese government's recent announcement of a new, lower annual GDP growth target of 7.5 percent.

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On whether China can avoid a hard landing, the report said Moody's sees growth remaining relatively robust over the medium term, provided that the country is spared severe economic or political shocks.

"The new target underscores the government's desire to engineer a soft landing, consistent with its long-term goal of seeking more balanced growth, decreasing the economy's reliance on investment and exports, while increasing the share of consumption," Tom Byrne, a senior vice president with Moody's Sovereign Risk Group, said in a statement.

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"In addition, we believe the authorities currently have time to prepare for this rebalancing."

Reuters