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Chinese GDP growth eases


Chinese GDP growth eases


China’s economy cooled between April and June.

Gross domestic product was up by 10.3 percent from the same period in 2009. In the first quarter it grew 11.9 percent.

Economists said that slowdown was likely to continue as Beijing ends stimulus spending brought in to counter the global crisis.

Against that background state-owned Agricultural Bank of China started trading its new stock in Shanghai on Thursday after it is raising 17 billion euros in the world’s biggest ever initial public offering of shares.

Wang Tuosha, chief analyst with Datong Securities, said AgBank is likely to suffer from future government moves: “The government is clamping down on the property sector and if property prices go down in the future it will definitely have a negative impact on the banks, this will lead to bad debts. Agricultural Bank, has less capital than the others and so will need more capital in the future.”

Those concerns about AgBank’s profitability and the need for more capital meant its shares were lacklustre in their first day of trading in Shanghai, indicating challenges ahead for other big Chinese banks, also needing to boost their balance sheets.

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