China’s fight against air pollution could lead to a slowdown in economic growth

Almaty. October 3. Silkroadnews – China’s fight against air pollution could lead to a slowdown in economic growth in the coming months, business information portal Gears of Biz wrote.
“China’s drive to cut pollution could reduce economic growth by 0.25 percentage point in the next six months,” the report said.
Cut in production volumes to reduce the amount of harmful emissions and toughening of national environmental inspections will also support the profits of large industrial companies as producer prices grow, said Yao Wei, chief China economist at SocGen in Paris.
“The Chinese government has turned very serious about fighting pollution. Modestly slower growth will be a necessary sacrifice for maintaining social stability over the medium term,” she explained
According to the task announced by President Xi Jinping in 2015, China's annual economic growth should be at least 6.5% over the next five years to double GDP per capita income by 2020. In case China manages to maintain economic growth at 6.8% this year, the growth rate needed to achieve the goal would account for 6.3% only in the next three years. In a December report, Yao wrote that China is ready to give up its 6.5% growth target for two years to curb the financial bubbles.
With production cuts strictly observed, the industrial production growth is likely to decrease by 0.6% -0.8%, and GDP growth will decrease by 0.2% -0.25% in the next six months.
The new plan of the Ministry of Environmental Protection to combat winter air pollution focuses on Beijing, Tianjin and provinces of Hebei, Henan, Shanxi and Shandong. It aims at reducing the consumption of coal used to generate electricity and emissions of vehicles.