China is looking for ways to boost growth as its economy and exchange traded funds (ETFs) continue to cool off.
The Chinese government has begun drafting plans for tax and spending policies in an effort to stimulate their economy after third quarter growth was at 9%. This is the slowest rate since the SARS outbreak in 2003.
Industrial production and construction slumped from July through September because of weak exports, a dead real estate market and temporary restrictions imposed during the Olympics, reports Keith Bradsher for The New York Times.
The country is planning a shift toward emphasizing a stable and rapid economic growth from the previous plan of ensuring growth and controlling inflation. The new policy includes an increase in export tax rebates for everything from labor-intensive products like garments and textile to high-value products like mechanical and electrical products. Support programs are being drawn up to help farmers and banks are encouraged to lend money to small- and medium-sized businesses.
The focus is deemed to be more in the consideration for human capital investment.
Could the iShares FTSE/Xinhua China 25 Index (FXI) find itself back in black as a result? It’s down 47.1% year-to-date, so it has a ways to go.
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