ISLAMABAD: China ended 2023 with economic growth that was better than anticipated, giving the world economy a much-needed boost despite internal struggles and external pressures.
The gross domestic product (GDP) of China increased by 5.2 percent year-on-year to a new high of 126.06 trillion yuan (approximately 17.7 trillion dollars) according to the National Bureau of Statistics. This was more than the 5 percent target set by the government and a definite rebound after the 3 percent growth in 2022.
Kang Yi, the bureau chief, said that the country had achieved all the key economic objectives of the year, but he admitted that there were still some challenges ahead.
In 2023, China is likely to have added more than 30 percent to the world GDP growth, remaining the most important economic driver in the world. Kang observed that the Chinese growth was higher than the projected world average of 3 percent and was on the top of the list among the major economies.
In spite of international trade headwinds, Chinese exports were up and inflation was kept low with the consumer price index increasing by only 0.2 percent as opposed to the ongoing inflation in most western countries.
Domestic consumption and services were a major force in the recovery. More than 82 percent of GDP growth was attributed to final consumption, and retail sales of consumer goods increased 7.2 percent year-on-year to more than 47 trillion yuan. GDP growth was 5.8 percent with service sector contributing 54.6 percent.
Real estate, which had been in a strained state, began to stabilize. Kang pointed out reduced drops in investment and housing sales as some of the first signs of recovery in the property market.
Wen Bin, the chief economist of China Minsheng Bank, termed the economic development as zigzag but progressive, and applauded the resilience that helped China to achieve its objectives.
Kang was optimistic about the future of the Chinese economy in 2024, as he said that the economy would remain on an upward trend, with the support of robust fundamentals, policy instruments, and reform dynamics. The actions like issuing more government bonds, tax cuts, and lowering of interest rates and reserve requirements implemented last year are likely to keep yielding fruits.
He observed that the government would still be working on its policy strategy and employ different economic levels to ensure stability and growth.
Even international institutions such as the OECD and the IMF have raised their projections of the growth of China in 2024, which is an indication of optimism in the economic prospects of the country.
Nevertheless, Kang cautioned that there may be challenges ahead, due to a complex and uncertain global environment. He emphasized the need to be flexible when confronted with external forces.
Kang concluded by saying that despite the headwinds, China will rise to the occasion and will ensure both quality and steady growth.
