Analysts are highlighting significant untapped potential within China’s economy, as recent data reveals robust growth trends and opportunities for further expansion. The release of the 2023 statistical communique by the National Bureau of Statistics (NBS) and the latest purchasing managers’ index (PMI) data offer key insights into the current state and future outlook of the world’s second-largest economy.
According to the communique, China’s economic growth for 2023 was confirmed at 5.2 percent year on year, matching preliminary figures and surpassing the government’s target of around 5 percent. This growth was accompanied by a 5.4 percent increase in per capita GDP, underscoring the nation’s robust economic momentum.
While the February PMI data revealed a slight dip in manufacturing activity to 49.1, experts like Bruce Pang, chief economist at JLL Greater China, attribute this to temporary seasonal factors such as the Chinese New Year. Despite this fluctuation, the non-manufacturing PMI demonstrated strong growth, indicative of China’s ongoing transition toward a more service-oriented economy.
A commentary in the Economic Daily suggests that strategic utilization of untapped capital and labor resources could propel China’s economic expansion beyond the 5 percent threshold. The article points out that the industrial capacity utilization rate stood at 75.1 percent in 2023, below the normal level of around 80 percent, indicating room for increased capital investment. Additionally, the average urban unemployment rate of 5.2 percent signals that labor resources remain underutilized.
The commentary emphasizes that China’s sustained high-speed growth in the past was not solely due to increased input factors but also the significant institutional dividends from reform and opening-up policies. The shift of labor from low-productivity agricultural sectors to higher productivity industrial and service sectors unleashed substantial “structural potential” for growth.
These economic insights arrive just ahead of China’s annual key political meetings known as the “Two Sessions,” where policymakers are expected to outline the country’s policy direction for 2024. The sessions are anticipated to focus on consolidating economic recovery gains and pursuing high-quality development, further bolstering confidence in China’s economic trajectory.
As China’s economy continues to evolve, analysts remain optimistic about its capacity for adaptation, innovation, and sustainable growth, highlighting opportunities for investors, businesses, and global stakeholders engaged with the Chinese market.
Reference(s):
cgtn.com
