CHINA’S economy ended 2024 on better footing than expected helped by a flurry of stimulus measures, although the threat of a new trade war with the United States and weak domestic demand could hurt confidence in a broader recovery this year.
For the full-year 2024, the world’s second-largest economy grew 5.0 per cent, data from the National Bureau of Statistics data showed on Friday, meeting the government’s annual growth target of around 5 per cent. Analysts had forecast 4.9 per cent growth.
The economy grew 5.4 per cent in the fourth quarter from a year earlier, significantly beating analysts’ expectations and marking the quickest since the second quarter of 2023.
Analysts polled by Reuters had forecast fourth-quarter gross domestic product (GDP) would expand 5.0 per cent from a year earlier, quickening from the third-quarter’s 4.6 per cent pace as a flurry of support measures began to kick in.
On a quarterly basis, GDP grew 1.6 per cent in October-December, compared with a forecast 1.6 per cent increase and a revised 1.3 per cent gain in the previous quarter.
The world’s second-biggest economy has struggled for traction since a post-pandemic rebound quickly fizzled out, with a protracted property crisis, mounting local debt and weak consumer demand weighing heavily on activity.
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Exports, one of the few bright spots, could lose steam as United States President-elect Donald Trump, who has proposed hefty tariffs on Chinese goods, is set to return to the White House next week.
Chinese policymakers have pledged more stimulus this year, but analysts say the scope and size of China’s moves may depend on how quickly and aggressively Trump implements tariffs or other punitive measures.
But even as strong exports propelled the country’s trade surplus to a record high of US$992 billion last year, the yuan currency has come under selling pressure. A dominant dollar, sliding Chinese bond yields and the threat of higher trade barriers have pushed the yuan to 16-month lows.
A slew of December economic readings on Friday suggested the economy gained traction heading into the new year, helped by a flurry of government support measures.
Industrial output grew 6.2 per cent from a year earlier in December, quickening from November’s 5.4 per cent pace and beating expectations for a 5.4 per cent increase in a Reuters poll. It marked the fastest growth since April last year.
Retail sales, a gauge of consumption, rose 3.7 per cent last month, accelerating from the 3.0 per cent pace in November as consumers started to prepare for the upcoming Lunar New Year in January.
As businesses remained wary of adding workers before the festival and with concerns over possible trade disputes with the US, the nationwide survey-based jobless rate climbed to 5.1 per cent in December from November’s 5.0 per cent. REUTERS
