Beijing's Stimulus Measures Support First Quarter GDP Rebound

Brian Turner
18 Apr, 2023
New York City

China's economy expanded at a faster pace in the first quarter, the National Bureau of Statistics reported Tuesday. 

GDP in the first quarter gained 4.5% from a year ago after rising 2.9% in the fourth quarter as activities picked up at the fastest pace in a year after the ending of strict zero-covid policy. 

The Chinese government has set 2023's economic growth target of around 5.0%. 

Domestic production and demand challenges and macroeconomic headwinds for exports may pose a challenge in the near term but the raft of infrastructure spending announced by the government is likely to kick the economy in the higher gear in the third and the final quarter of the year. 

Retail sales soared 10.6% in March, significantly higher than 3.5% in February, driven 11.5% rebound in vehicle sales and 37.4% jump in precious jewelry sales. 

Retail sales rose at the fastest pace since June 2021. 

Industrial production increased 3.9% in March following a 2.4% rise in January-February period driven by higher output from manufacturing and utilities but mining activities shrank. 

Industrial production rose at the fastest pace since October.    

Fixed-assets investment increase slowed to an annual pace of 5.1% in the first quarter from the 5.5% rise in the first two-month period. 

China's economic recovery is expected to be uneven in the months ahead on the worries about the strength of domestic demand and uncertainties about exports. 

 “We must be aware that the situation abroad is still complex and volatile, inadequate domestic demand remains prominent and the foundation for economic recovery is not solid yet," said NBS spokesman Fu Linghui. 

The jobless rate in March eased to 5.3% from 5.6% in February but the advanced electronics manufacturing industry continued to shrink after exports of electronics products fell. 

Micro computing devices manufacturing fell 21.6% in March, mobile phone production declined 7.6% and integrated circuits output fell 3%.