- Standard Chartered said China’s economic recovery story has been largely disappointing, but the economic powerhouse is seeing excellent growth in one particular sector.
- Winters noted that although China’s recovery is still “a bit difficult,” what China is building is a more resilient, sustainable and stronger economy.
A Chinese flag flies outside a residential complex in Beijing on April 30, 2017.
Greg Baker | AFP | Getty Images
Bill Winters of Standard Chartered said that China’s economic recovery story has been largely disappointing, but the economic powerhouse is seeing excellent growth in one particular sector.
“Electric vehicles and everything related to sustainability and renewable energy technology. In these areas, China is absolutely thriving,” the bank’s CEO told CNBC’s Emily Tan on the sidelines of the Global Financial Leaders Investment Summit on Tuesday.
He added that while China’s recovery is still “a bit difficult,” the country is also working to build a more resilient, sustainable and stronger economy.
And her playbook? Winters added: “Gradually easing pressure on sectors of the old economy, and accelerating in sectors of the new economy.”
China boasts the world’s largest electric vehicle market With 5.9 million units sold in 2022, accounting for 59% of electric vehicles sold globally, according to research by Canalys. In addition, Counterpoint Research data showed this Local brands account for 81% of the electric vehicle market -With BYD, Wuling, Chery, Changan and GAC among the top players.
Conversely, the real estate market has suffered from declining consumer confidence, with real estate giants Evergrande and Country Garden continuing to be mired in debt problems.
Winters said Standard Chartered has reduced its exposure to China’s troubled real estate sector and is facing a major hit in that market. While he said it is not wise to hit the bottom for China’s real estate market just yet, the markets have “entered the second half of the real estate decompression process.”
A residential complex built by Evergrande in Huai’an, Jiangsu, China, on July 20, 2023.
Future Publishing | Future Publishing | Getty Images
Just last week, the UK-based bank announced that its pre-tax profits for the third quarter of this year fell by 33%.
China’s post-Covid recovery has slowed since April. What is further hampering the recovery is the real estate slump that accelerated over the summer, despite many major cities easing restrictions on purchasing apartments.
However, China remains an important market for the bank. Other countries include India, the United Arab Emirates, South Korea, Singapore and Hong Kong.
“Hong Kong is a core market for us. We’ve been here for almost 170 years. It’s our largest single market,” Winters continued.
Standard Chartered’s overseas business, based in Hong Kong, is growing 50% to 60% annually, Winters said. “So it’s a huge growth story for us.”
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