The Chinese economy is doing better than expected: GDP remained unchanged in the last quarter of last year, while a contraction of 1% was assumed. This is evident from new data on Tuesday.
Looking at the full year of 2022, economic growth will amount to 3 percent. “That figure is just as good, despite the fact that the target was 2.5 percentage points higher,” says BNR in-house economist Han de Jong. “Earlier it became clear that they weren’t going to hit that 5.5 percent.” According to De Jong, strict lockdowns in the country are a major factor in the disappointing figures. “That’s why I see these results as a positive surprise.”
According to De Jong, the fact that GDP remained unchanged in the fourth quarter of 2022 can really be called a fluke. “A one percent contraction was originally expected.”
According to Boudewijn Poldermans, a sinologist and board member of the Netherlands China Business Council, data from China should always be discussed with caution. It is unclear whether the figures are always correct. According to the World Bank, growth was only 2.7% in 2022, instead of 3%. The stories about expectations for 2023 also differ: from about 4.3 to 4.8% growth.
Obstacles
First of all, according to Poldermans, we have to wait and see what happens in China in the field of covid. “They quite abruptly changed the strict covid policy, just before the yet to come Chinese New Year. Furthermore, the Chinese still face some medium-term hurdles. Think of the demographic developments in the country, such as the active population which will drastically decrease to about half. Furthermore, for example, the state’s pension fund is expected to empty in 2035. These are serious problems.’
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
