Market veteran Howard Marks cautions that China's economic growth target is a 'Herculean challenge'

Veteran capitalist Howard Marks said helium was hopeful astir China's economy, but cautioned that the country's maturation people was a monumental challenge.

"I'm inactive optimistic connected China's semipermanent possibilities, arsenic agelong arsenic they execute good and arsenic agelong arsenic they stay constructive with respect to the remainder of the world," the co-chairman of Oaktree Capital Management said.

Marks told CNBC's Emily Chan connected the sidelines of the 3rd Global Financial Leaders Investment Summit hosted by the Hong Kong Monetary Authority that "Even though the maturation complaint they [China] are targeting sounds humble compared to their history, it's inactive precise overmuch supra mean for for the remainder of the world, and volition correspond a Herculean challenge."

China has acceptable a maturation people of "around 5%" for 2024, though Bank of America and Citigroup, among others, person projected the world's second-largest system volition turn astatine nether 5%.

The World Bank has pegged China maturation successful 2024 astatine 4.8%, and expects it to decline further to 4.3% adjacent year, contempt a caller slate measures to boost the economy. Chinese authorities person ramped up stimulus rollouts since precocious September.

The World Bank cited headwinds specified arsenic sluggish Chinese user spending, a struggling spot marketplace and an ageing colonisation arsenic cardinal concerns for the world's second-largest economy.

"You can't nutrient economical maturation done stimulus perpetually. So their maturation complaint is abating, their usage of stimulus is abating, and they're trying to technologist the close combination," Marks said, adding that helium was hopeful China volition beryllium capable to conscionable the challenges.

Earlier this month, China unveiled a five-year plan worthy 10 trillion yuan ($1.4 trillion) to code section authorities indebtedness issues, portion indicating that further economical enactment would beryllium provided adjacent year. This followed Donald Trump's 2024 statesmanlike triumph that has raised worries implicit accrued tariffs connected Chinese exports.

The People's Bank of China successful September chopped the reserve request ratio (RRR) by 50 ground points to infuse much liquidity into the Chinese economy, with banks present required to clasp little currency connected hand. The aforesaid month, President Xi Jinping led a meeting emphasizing the request to heighten fiscal and monetary enactment portion moving to halt the diminution successful the existent property market.

"But erstwhile there's excessively overmuch stimulus successful an country similar property, and you get excessively galore buildings built, past you person to spell done a play of adjustment," said Marks.