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China’s Economy Facing “Considerable Downward Pressure”

Key Speakers At The Final Day Of The APEC SummitKey Speakers At The Final Day Of The APEC Summit
Xi's words are as true today as they were four months ago. Apparently.Photograph by SeongJoon Cho — Bloomberg via Getty Images

Chinese President Xi Jinping says the world’s second-largest economy is working to overcome the challenges of slowing global growth, and will remain resilient in the long-term as it works to implement reforms.

“In general, China’s positive economic fundamentals and long-term trajectory remain unchanged. On the other hand, China’s economy is still coping with the complicated internal and external environment, considerable downward pressure and the temporary pain of deep reforms,” Xi said in a speech given at the Asia-Pacific Economic Cooperation CEO Summit in Manila on Wednesday.

China’s third-quarter gross domestic product dropped below 7% for the first time since 2009, coming in at 6.9%. Over the last 10 years, the country’s GDP growth has been gradually declining as increasing debt and slowing industrial production weigh on China’s economy. Some analysis suggests the nation’s economy is growing closer to 5% than 7%, as Fortune’s Scott Cendrowski reports.

As a part of its long-term plans, Xi’s administration is attempting to rebalance the economy away from manufacturing towards services, and is pushing for a higher contribution from consumption. Reforms have included sealing free trade agreements with other countries and pushing the Chinese-led “One Belt, One Road” initiative to link the country with Europe through central and western Asia, Xi said in his speech.

Despite the slowdown, Xi emphasized that China still accounts for 30% of global economic growth. “Some economic indicators have somewhat fluctuated between months and quarters, but the overall economy has operated within the reasonable range and maintained steady and fairly rapid growth,” Xi said, as reported by Bloomberg. China’s Ministry of Commerce had previously said the country’s overseas direct investment had increased by 16.3% in 2015 to around $92 billion, highlighted by a $15 billion deal with Argentina this week to build nuclear plants, and around $30 billion of new investments in the U.K. announced last month during Xi’s trip to the U.K.

However, China’s stocks fell for the second day following Xi’s speech, as new data on home price growth showed no signs of how China could rebound from their slowdown. “There’s no spotlight in the economy now as the new growth engine has yet to emerge,” Dai Ming, a fund manager at Hengsheng Asset Management in Shanghai, told Bloomberg.

China’s secular stagnation is also pulling down the world’s economic outlook. In October, the International Monetary Fund lowered its global growth expectations for the year from its July forecast, citing China’s economic struggles and low commodity prices.