Social Housing To Provide Limited Support To Growth

With the recent announcement by the central government that as many as 5.8mn new public housing units will be built in China over the next year to help alleviate housing shortage concerns, there is a clear risk that total construction, and therefore economic growth will exceed our expectation. However, given our view of a slowdown in private construction, and likely problems with social housing implementation, we are happy to stick to our view of significantly weaker growth in construction, and uninspiring economic expansion in 2011.

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