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Wednesday, May 31, 2023

China’s GDP reaches $17.44 trillion, making it the world’s second-largest economy

BusinessChina's GDP reaches $17.44 trillion, making it the world's second-largest economy

China’s economy remains strong despite facing pressures and challenges from a gloomy global outlook, slowing external demand, and a weak property sector. According to the National Bureau of Statistics, China’s GDP surpassed 121 trillion yuan ($17.44 trillion) in 2022, making it the world’s second-largest economy. The country managed to deal with economic shocks in 2022, posting a 3 percent year-on-year growth.

Officials and analysts are optimistic about China’s economic growth in 2023, citing stronger-than-expected fourth-quarter data and the “green shoots of recovery” emerging in recent economic activities. Louise Loo, a senior economist at British think tank Oxford Economics, expects growth to accelerate sequentially in the first quarter of 2023, as China prioritizes reviving the economy and stabilizing growth. She also anticipates more stimulus policy measures to be highlighted in the annual Government Work Report to be released during the upcoming two sessions.

Despite the softening global demand conditions and the ongoing global manufacturing and semiconductor downcycles, Deutsche Bank is bullish on the Chinese market and has revised its 2023 economic growth forecast for China from 4.5 percent to 6 percent. Wu Chaoming, deputy director of the Chasing International Economic Institute, also voices optimism for a robust 2023, given the optimized COVID-19 measures and stronger macroeconomic policy support.

Wu expects China’s GDP to grow by about 5.3 percent year-on-year in 2023, with a robust recovery in consumption, especially as the increase in household savings over recent years may partially translate into a rebound in consumer spending. Luo Zhiheng, chief economist at Yuekai Securities, anticipates that the country may set this year’s national GDP growth target at around 5 percent year-on-year, adding that expanding domestic demand and boosting market confidence will be key for stabilizing overall growth.

China’s economy, characterized by strong resilience, tremendous potential, great vitality, and long-term sustainability, will remain sound despite facing a more complicated and grimmer external environment, says Sheng Laiyun, deputy head of the NBS. According to data released by the NBS, China has maintained its position as the world’s largest manufacturing hub, with the value-added output of the manufacturing sector hitting 33.5 trillion yuan in 2022.

The country’s gross domestic expenditure on R&D reached 3.1 trillion yuan last year, surpassing the 3 trillion yuan milestone for the first time, the NBS said. Mao Xinsheng, chairman of Beijing-based AI medical company Shukun Technology, spoke highly of China’s intensified efforts to foster innovation-driven growth, saying the development of the high-tech sector and the digital economy will add fresh impetus to the economy.

China’s economy is set to continue its steady recovery trend despite economic shocks. The country’s ability to buffer headwinds and post notable growth this year makes for a good start in building a modern socialist country in all respects.

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