The Chinese economy could post slower growth in the second half of 2018, due to "short-term pain" from the drive to deleverage and cut overcapacity, according to global investment bank JP Morgan Chase.
However, global investors are increasingly encouraged by the Chinese government's focus on quality growth and recent opening measures in the financial sector would attract more global investors, Jing Ulrich, managing director and vice chairman for Asia Pacific at JP Morgan Chase, told a press briefing in Beijing on Monday.
"We expect that GDP growth may slow down slightly in the second half of 2018, mainly due to deleveraging and capacity reduction. While the purpose of this is to improve efficiency of the overall economy, it may bring some pain in the short term," said Ulrich.
Still, JP Morgan Chase forecast a full-year growth rate of 6.7 percent, higher than the Chinese government's target of around 6.5 percent.
The bank cited several encouraging signs, including stable growth in consumption supported by fast growth in per capita disposable income as well as high employment rates and other fundamentals, according to Ulrich.
"The new economy" has also grown rapidly as structural reforms continue and has become a stabilizer for economic growth, she added, pointing to new rising sectors such as environmental protection, technology innovation and information technology infrastructure.
"China's commitment to high-quality growth has made global investors more confident about China," Ulrich said. "Deepening reforms and further opening of the Chinese capital markets would attract more global investors into China."
The interest of global investors is evident in terms of the JP Morgan Chase China Summit, set to start on Tuesday.
More than 2,200 delegates from 50 countries and regions will attend the event, JP Morgan Chase said in a press release.