booming china suddenly worries

Booming China Suddenly Worries That a Slowdown Is Taking Hold
— Many Chinese have been expecting a post-Olympics economic slowdown, but it has already started and the Games have not even begun.

In October, Chinese stocks hit records, and the housing market had been strong for years. Now, a slowdown is emerging.


Chinese factories reported a plunge in new orders last month. Exports are barely growing. The real estate market is weakening, with apartment prices sinking in southeastern China, the region hardest hit by economic troubles.

The trends, which actually have little to do with the Olympics (the Games themselves, which open Friday, are small compared with the size of the economy), are being felt worldwide.

China’s slowing growth is one reason that gasoline prices have fallen in the United States, for example. Similarly, world prices for metals like copper, tin, zinc and aluminum have tumbled in the last several weeks, as voracious Chinese factories have closed, or cut back their consumption.

But while China’s difficulties may reduce inflationary pressures around the world, they threaten to slow further the already tenuous global economic growth.

“China has slowed down a lot already, but it’s going to slow down more,” said Hong Liang, the senior China economist at Goldman Sachs.By KEITH BRADSHER
Published: August 5, 2008