China GDP Grew 4.5 Percent in the First Quarter, Retail Sales Up 5.8 Percent
SHANGHAI — China logged 4.5 percent year-over-year GDP growth in the first quarter of 2023, beating market expectations.
According to data released by the National Bureau of Statistics on Tuesday, the world’s second-largest economy expanded to 2.84 trillion renminbi, or $413.15 billion. A pool of analysts surveyed by Reuters previously set an estimate of 4 percent growth.
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Compared to the fourth quarter of 2022, the Chinese economy logged 2.9 percent growth.
From January to March, retail sales of consumer goods totaled 1.149 trillion renminbi, or $167.17 billion, up 5.8 percent compared to the same period last year. For the month of March, growth was 10.6 percent increase year-over-year.
According to Iris Pang, chief economist of Greater China for ING, better-than-expected first-quarter results meant the Chinese government would likely hold back extra stimulus plans to boost the economy.
“But the government will probably keep its infrastructure investment plan as a supplementary growth engine as we expect the external market to deteriorate further in 2023,” Pang said. China’s battered real estate market, high youth unemployment rate, and weak export growth also pose uncertainty for the economy’s future.
Compared to the first quarter last year, apparel sales rose 9 percent; cosmetics sales rose 5.9 percent, and gold, silver and jewelry sales registered 13.6 percent growth.
E-commerce sales grew 8.6 percent year-over-year in the first quarter, accounting for 24.2 percent of total retail sales.
According to Lingjun Fu, spokesperson for NBS, consumer service sectors, such as tourism, dining and the box office, has been a bright spot in the first quarter, as Chinese consumers unleashed pent-up demand for offline experiences post-reopening.
“Growth momentum will gradually regain strength in the next stage,” said Fu, citing the importance of consumption-led growth for the economy. Beijing eyes modest 5 percent GDP growth for 2023, the lowest target in decades.
Fu expects second-quarter growth to be “significantly faster” than the first quarter, considering a low base due to COVID-19 disruptions in the second quarter of 2022. “However, the third and fourth quarter growth rate is expected to be lower due to a higher base in the same period last year,” Fu added.
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