2023 economic recovery in China
China’s economic potential advanced in the first two months of 2023 as increased consumption and infrastructure investment led to a recovery from the disruption of the pandemic, despite lower global consumption and an underperforming property sector.
China’s lifting COVID-19 restrictions by the end of 2022 has boosted the $18 trillion economy, suffering from an alarmingly low performance in nearly half a century. Analysts predict that the momentum will intensify in the near term.
The industrial sector was 2.5% higher in January-February than a year earlier, figures from the National Bureau of Statistics showed. Statistical reports showed a 1.4% year-on-year increase in December.
Retail sales advanced 3.6% year over year. The result aligned with experts’ predictions and expectations for consumption-driven economic growth, as declining global dependence on demand, weakens Chinese exports.
The COVID-sensitive food sector was particularly positive with the reopening, with January-February revenue up 9.3%, compared to December’s 14.1% year-on-year.
A pullback in exports and a downturn in the real estate sector hamper the recovery. They estimate the gross domestic product will be 3.7% higher in the first quarter.
Fixed investment in the first two months was 5.6% higher than in the year-ago period, rising slightly faster than the annual increase for all of 2022.
China has set a balanced annual growth target of 5%.
China’s urban unemployment rate improves in February
In February, the urban unemployment statistic based on a nationwide survey improved from 5.5% in January to 5.6%. Beijing has also set a relatively ambitious job creation target of around 12 million, and unemployment will be a main indicator of the economy’s health and strength and any potential policies.
China’s economy will improve further in the near term as it takes advantage of huge base effects, partially offsetting problems with sluggish exports and a sluggish real estate market.