China 2022 growth hit by corona restrictions
China’s economy grew last year at the second slowest rate in almost half a century - in a sign of how the country’s strict coronavirus regulations affected businesses.
Official figures show the gross domestic product (GDP) of the world’s second largest economy rose 3 per cent in 2022. That is way below the government’s target of 5.5 per cent but better than most economists had forecast.
Last month, Beijing abruptly lifted its strict zero-Covid policy. The policy had a major impact on the country’s economic activity last year but the sudden relaxation of the rules has led to a jump in Covid cases that threatens to also drag on growth in the early part of this year.
Other than at the start of the pandemic in 2020, when full-year GDP expanded by 2.2 per cent, last year’s economic growth was the weakest since 1976, when the founder of the People’s Republic of China Chairman Mao Zedong died.
“The data came in stronger than our expectation. Nevertheless, it reveals the hard hit to the Chinese economy from a zero-Covid policy and a property rout in 2022,” Jacqueline Rong, deputy China economist from the BNP Paribas bank, told the BBC.
Economic numbers
Experts have voiced caution over China’s economic numbers - with some warning that the trajectory of the data rather than the figures themselves are a useful guide to how the country’s economy is performing.
Other Chinese economic data such as retail sales and factory output for December, which were released along with GDP data, also beat expectations but were still weak compared to pre-pandemic levels.
“That is not bad news for the economy. It almost feels like household consumption held up well in spite of the surge of infections towards the end of last year,” Qian Wang from the Vanguard investment firm said.
“We are heading into 2023 with stronger momentum... this will pose a lot of upside to economic growth,” she added.
– BBC
