China vegetables
A woman selects vegetables at a supermarket in Beijing, China, April 11, 2019. (Photo: REUTERS/Jason Lee)

Amid fears of a global recession possibly impacted by China's slowing economy, an expert stressed that the Chinese economy is not as "gloomy" as some analysts see it. The economy is not on the verge of crashing, he said.

A former officer at the People's Bank of China and Vice-Chairman of YX Distressed Asset Recovery, Joe Zhang, wrote in a Thursday op-ed for the South China Morning Post that the Chinese economy not at the end of the line. He said the central bank still has a lot of space for cuts if it decides to do so in more serious scenarios.

Aside from China's central bank has more space for cutting interest rates, Zhang pointed out that only "very few" companies or even local governments in the country have liquidated their assets supposedly in a bid to curb the effects of the slowing economy.

Zhang went on to explain that in recent surveys and studies, it was displayed how China's household consumption is still doing well. Construction projects in home turf are still pushing through despite the slowdown.

In light of China's current situation and fears of a global recession, Zhang went back to a year ago, when over a hundred public companies struggled. He noted that Beijing came to the rescue to help the said firms recover.

As for this year's crisis, Zhang believes the government will also react as needed. At this point, the Chinese economy is still holding up, he said, adding that the country has experienced similar economic struggles in the past but still overcame the tides.

Zhang's comments came amid reports that the economy worsened in July. Industrial output slumped to a 17-year low that triggered talks about the country possibly going into recession sometime soon.

Multiple outlets reported on Tuesday that China's business and industrial activity cooled down further last month despite the government's efforts in pouring support for affected industries.

On the other hand, some economists believe there are other sectors and economic segments that could pull up GDP figures. The trade war did have an impact on the Chinese economy but it is too early to say a recession is within reach.

Director of the Wilson Center's Kissinger Institute, Robert Daly, said last week that the White House's labels on the Chinese economy "are exaggerations at best, and some of them are better qualified as misleading."

Daly explained that China is doing well in terms of adjusting the necessary margins and finding ways to cushion the economy, contradicting Washington's claims that the country is collapsing.