'It's like being reprimanded instead of being advised.'
The International Monetary Fund (IMF) stressed the need for China to coordinate its zero-covid-19 policy to restore the real estate market's confidence in driving growth next year.
In a virtual meeting between Chinese officials and the IMF on Wednesday, the Beijing government was urged to speed up the pace of vaccination in an effort to ensure support for the stalled property market.
In general, Covid-19 has depressed economic activity in China with the property market being the biggest contributor to the weak growth rate despite weakness in global demand.
Like other countries, the IMF also puts a gloomy outlook on China's growth with this year's projection at 3.2% while other economists forecast 4.4% for 2023 and 2024.
According to IMF's China country managing director, Gita Gopinath, the real estate sector needs to be fixed and done in the right way because weaknesses in it increase the risk to the financial sector.
In the meantime, the IMF mission team recommended reforms to the real estate sector including improvements in pre-sale capital and the availability of alternative savings options.
Also included in the proposal is that the authorities need to protect new home buyers from the risk of the house being paid for not being completed.
On the other hand, the IMF advised China to maintain a neutral fiscal policy stance in supporting households in 2023 in an effort to balance its economy.
